T-Mobile LTE Done 11:36 AM ezto.mheducation.com?C le 3 Homework: On-line Section

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T-Mobile LTE Done 11:36 AM ezto.mheducation.com?C le 3 Homework: On-line Sections Question 5 (of 25) .00 points Lynn Ally, owner of a local Subway shop, loaned $54,000 to Pete Hall to help him open a Subway franchise. Pete plans to repay Lynn at the end of 7 years with 10% interest compounded semiannually How much will Lynn receive at the end of 7 years? (Do not round intermediate calculations. Round your answer to the nearest cent.) Future value References eBook & Resources Worksheet Difficulity: Basic Leaming Objective: 19-01 (2) Calculate amount and interest manualy, using alg and with a financial calculator Check my work

Explanation / Answer

Amount borrowed = $54,000
Annual Interest Rate = 10%
Semiannual Interest Rate = 5%
Loan Period = 7 years
Semiannual Period = 14

Future Value = Amount Borrowed * (1 + Semiannual Interest Rate)^Period
Future Value = $54,000 * 1.05^14
Future Value = $106,916.31

So, Lynn will receive $106,916.31 at the end of 7 years

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