SOLUTION: bonza will need $35000 in 5 years to start his own business.he plans to save the money by making semi-annual deposits in an acount earning 7.8% per year compound semi-annually A

Question 1168490: bonza will need $35000 in 5 years to start his own business.he plans to save the money by making semi-annual deposits in an acount earning 7.8% per year compound semi-annually
A) what semi-annual deposit must boza make
B) how much interest does boza earn

Answer by Theo(13342) (Show Source): You can put this solution on YOUR website!
use an online financial calculator such as the one found at https://arachnoid.com/finance/index.html

your inputs will be:

pv = 0
fv = 35000
np = 5 * 2 time periods per year = 10 time periods
pmt = what you want to find
ir = 7.8% per year divided by 2 time periods per year = 3.9% per time period
payments made at end of each time period.

each time period is a semi-annual time period.

click on pmt and the calculator tells you that the payment at the end of each time period needs to be equal to 2928.73.

it's shown as negative because it's money that goes out from you.

here's a display of the inputs and output from that calculator.
the output is the pmt.

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