Question 1201175: If $10,000 is invested at an interest rate of 2% per year, compounded semiannually, find the value of the investment after the given number of years. (Round your answers to the nearest cent.)
6 years
12 years
18 years
Answer by Theo(13342)   (Show Source):
You can put this solution on YOUR website! 2% per year, compounded semi-annually, equals 1% per semi-annual period.
6 years = 12 semi-annual periods.
12 years = 24 semi-annual periods.
18 years = 36 semi-annual periods.
in 6 years, 10,000 will be equal to 10,000 * 1.01 ^ 12 = 11268.2503
in 12 years, 10,000 will be equal to 10,000 * 1.01 ^ 24 = 12697.34649
in 18 years, 10,000 will be equal to 10,000 * 1.01 ^ 36 = 14307.68784
the equation can be graphed as shown below.
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