Question

A teacher deposits $900 in an account that pays 7.55% annually. If the teacher withdraws all the money in the account after 180-days, how much does the teacher withdraw?

Answer 1

$933.3

Explanation:

Given data

Principal= $900

Rate= 7.55%

Time= 180 days>>> 6months>>> 0.5 years

Say the account is on a compound interest plan

A= P(1+r)^t

substitute

A= 900(1+0.0755)^0.5

A= 900(1.0755)^0.5

A= 900*1.037

A= $933.3

Hence the teacher will withdraw $933.3 on a compound interest investment after 6 months