To calculate the future value of Kaitlin's deposit after 9 years with semiannual compounding, we can use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A = the amount of money accumulated after n years, including interest
P = the principal amount ($4000 in this case)
r = the annual interest rate (3.6% or 0.036)
n = the number of times that interest is compounded per year (2 for semiannual compounding)
t = the number of years the money is invested for (9 years in this case)
Plugging in the values:
A = 4000(1 + 0.036/2)^(2*9)
A = 4000(1 + 0.018)^18
A = 4000(1.018)^18
A = 4000(1.405071529)
A = 5620.286116
Therefore, Kaitlin will have approximately $5620.29 in the account after 9 years with semiannual compounding.
Kaitlin deposited $4000 into an account with 3.6% interest, compounded semiannually. Assuming that no withdrawals are made, how much will she have in the account after 9 years?
Do not round any intermediate computations, and round your answer to the nearest cent. •
1 answer