Question

Assume Vaughn Manufacturing deposits $99000 with First National Bank in an account earning interest at 6% per annum, compounded semi-annually. How much will Vaughn have in the account after 5 years if interest is reinvested?

Answer 1

amount = $133047.72

Step-by-step explanation:

given data

deposits principal = $99000

earning interest rate = 6% = 0.06

time = 5 year

solution

we will get here amount for compounded semi-annually that is express as

amount = principal ×
`(1+ (r)/(n))^(nt)` ........................1

here n is 2 for semi annually

so put here value in equation 1 we get

amount = $99000 ×
`(1+ (0.06)/(2))^(2* 5)`

solve it we get

amount = $133047.72