A = P(1+ r/)^nt
A = 10000(1 + .12/2)^2(5)
= 10000(1.06)^10
= $ 17,908.48
Yes
Pete Air wants to buy a used Jeep in 5 years. He estimates the Jeep will cost $15,000. Assume Pete invests $10,000 now at 12% interest compounded semiannually.
Calculate the maturity value of the investment
2 answers
Principal, P = $10000
interest per period of 6 months, i = 0.06
number of periods, n = 5 yrs/0.5 yr = 10
Value at maturity
=P(1+i)^n
He will have money to pay for the Jeep, and perhaps the sales taxes as well.
interest per period of 6 months, i = 0.06
number of periods, n = 5 yrs/0.5 yr = 10
Value at maturity
=P(1+i)^n
He will have money to pay for the Jeep, and perhaps the sales taxes as well.
1 answer