SOLUTION: Sara deposited $1400 for 1 year at 10%, compound semiannually. b. What percent interest was added each time? c. What was the balance in Sara's account at the end of 1 year?

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Question 1201119: Sara deposited $1400 for 1 year at 10%, compound semiannually.
b. What percent interest was added each time?
c. What was the balance in Sara's account at the end of 1 year?
Found 3 solutions by Theo, mananth, ikleyn:
Answer by Theo(13342)   (Show Source):
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10% per year compounded semi-annually / 2 = 5% per half year.
she deposited 1400.
at the end of the first semi-annual period, she earned 5%.
the remaining bslance in the account was 1400 * 1.05 = 1470.
at the end of the second semi-annuial period, she erned 5%.
the remaining bgalance in the account was 1470 * 1.05 = 1543.5.
that's how much she had in the account at the end of 1 year.

Answer by mananth(16949)   (Show Source):
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t the end of one year A = $1,543.50

Answer by ikleyn(53618)   (Show Source):
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.Sara deposited $1400 for 1 year at 10%, compound semiannually.
b. What percent interest was added each time?
c. What was the balance in Sara's account at the end of 1 year?
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(b) What percent interest was added each time? Two semi-annual compounding produce the effective increase per year = = = 1.1025, so the effective interest per year is 10.25%. (c) What was the balance in Sara's account at the end of 1 year? The balance in Sara's account at the end of 1 year is = = 1543.50 dollars.

Solved. Both questions are answered.