Question

Jason deposits $6,500 in a certificate of deposit that pays 1.3% interest,compoundedsemi-annually.a. How much interest does the account earn in the first 6 months?b. What is the balance after 6 months?

Answer 1

When you have an interest compoounded semi anually. It means that it is 2 times in a year. If y ou have 1,3% of interest you receive the half every 6 months

Then in the first 6 months the interest is:

1.3$ /2 = 0.65%

Then to calculate the balance you calculate the 0.65% of the $6,500