SOLUTION: Give the number of periods, n, and the interest rate per period, i, for the following situation. Express value of i to two decimal places e.g. 0.05 6% compounded semiannually for

Question 1080205: Give the number of periods, n, and the interest rate per period, i, for the following situation. Express value of i to two decimal places e.g. 0.05
6% compounded semiannually for 10 years
Answer by jorel1380(3719) (Show Source): You can put this solution on YOUR website!
6% is compounded semiannually, or 3% every compounding period. Over 10 years, that amounts to 20 compounding periods. Thus n=20. So:
i=[(1.03)^20]-1
i=1.8061112346694138117573133075817-1
i=80.61112346694138117573133075817% interest on the principal. ☺☺☺☺
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