Question

Find the interest earned on invested for years at ​% interest compounded as follows. a. Annually b. Semiannually​ (twice a​ year) c. Quarterly d. Monthly e. Continuously

Answer 1

$3979.79

2 $4023.63

Step-by-step explanation:

Here is the full question used in answering this question :

Find the interest earned on $15,000 invested for 6 years at 4% interest compounded as follows. a. Annually b. Semiannually (twice a year) c. Quarterly d. Monthly e. Continuously

the formula for determining interest earned is :

future value - present value

The formula for calculating future value:

FV = P (1 + r/m)^mn

FV = Future value

P = Present value

R = interest rate

N = number of years

m = number of compounding

1. 15,000 ( 1 + 0.04)^6 = 18979.79

18979.79 - 15,000 = $3979.79

2 1. 15,000 ( 1 + 0.04/2)^12 = 19023.63 = $4023.63