Asked by anita

what is the future value of $5,000 in a bank account for 7 years at 4 percent compounded bimonthly

Answers

Answered by Henry
V = Vo(1+r)^n.

Vo = $5000 = Present value.

r = ((4% / 12)*2)/100% = 0.0066667 = Bi-monthly
rate expressed as a decimal.

n = 6Comp./yr * 7yrs = 42 Compounding
periods.

Plug the above values into the given Eq.

Answer: $6609.50.
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