Alebra help
- Thread starter lwhiley
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$2,350 is invested in account paying 9% compounded semiannually. How much will the account be worth after 8 years?
so this question is asking you to calculate the future value of the sum of money.
Future value=present value * (1+interest rate)^#compounding periods
you interest rate of 9% is being compounded semiannually and the question wants to know how much it will be worth in 8 years so the number of compounding periods will be 8*2=16
FV=2350(1.09)^16
i think that's right
so this question is asking you to calculate the future value of the sum of money.
Future value=present value * (1+interest rate)^#compounding periods
you interest rate of 9% is being compounded semiannually and the question wants to know how much it will be worth in 8 years so the number of compounding periods will be 8*2=16
FV=2350(1.09)^16
i think that's right
As a very rough rule of thumb, we can use the "rule of 70".
At 9 percent interest, we can estimate that the money will double in approximately 8 years (8*9=72).
Therefore, your answer should be close to $4700.
The rule of 70 is a way to ESTIMATE how long it will take an investment to double at a given interest rate.
7% * 10 years
8% * 9 years
9% * 8 years
12 % * 6 years
14 % * 5 years
etc...
At 9 percent interest, we can estimate that the money will double in approximately 8 years (8*9=72).
Therefore, your answer should be close to $4700.
The rule of 70 is a way to ESTIMATE how long it will take an investment to double at a given interest rate.
7% * 10 years
8% * 9 years
9% * 8 years
12 % * 6 years
14 % * 5 years
etc...