nt Use the compound interest formulas, A P 1and A - Pe, to solve the following p
ID: 3115140 • Letter: N
Question
nt Use the compound interest formulas, A P 1and A - Pe, to solve the following problem. Find the accumulated value of an investment of $20,000 or 6 years at an interest rate of 5.5% f he money is a compounded semiannually, b compounded monthly, c compounded continuously. a. What is the accumulated value, if the money is compounded semiannually? $(Round your answer to the nearest cent.) b. What is the accumulated value, if the money is compounded monthly? Round your answer to the nearest cent.) c. What is the accumulated value, if the money is compounded continuously? $L (Round your answer to the nearest cent.)Explanation / Answer
A) If Compounded semiannually,
A = 20000(1 + 0.055/2)2 * 6
= 20000(2.055/2)12
= 27695.6755
B) if Compounded monthly
A = 20000(1 + 0.055/12)12 * 6
= 20000(12.055/12)72
= 27798.3961
C) If Compounded continuously
A = 20000 * e0.055 * 6
= 27819.3626
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