Find the value and interest earned if $8906.54 is invested for 9 years at % compounded a) semiannually b) continuosly

Isa Trevino

Isa Trevino

Answered question

2020-11-29

Find the value and interest earned if $8906.54 is invested for 9 years at % compounded
a) semiannually
b) continuosly

Answer & Explanation

Mayme

Mayme

Skilled2020-11-30Added 103 answers

a) The future value for the amount $8906.54 for 9years at 3% compounded semiannually is calculated a follows.
A=P(1+r2)2t(semiannually)
A=8906.4(1+0.032)(29)
=$11643.88
b) The future value for the amount $8906.54 for 9years at 3% compounded continuously is calculated a follows.
Future value =Aert
=(8906.54)e(0.03)(9)
=$11667.25
Interest earned =AP
=11667.258906.54
=$2760.71
Jeffrey Jordon

Jeffrey Jordon

Expert2021-10-27Added 2605 answers

Answer is given below (on video)

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