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1 year ago

if $5,000 is invested at 3.2% annual interest compounded semiannually, how much will the investment be worth in 10 years?

Business

1 answer:

Helen [10]1 year ago

5 0

The amount of money would be $6,851.2 in the account after 10 years.

<h3>What is Compound interest?</h3>

Compound interest is defined as interest paid on the original principal and the interest earned on the interest of the principal.

A = P(1+r/100)ⁿ

Where:

A = the future value of the investment or loan

P = the principal investment or loan amount

r = the interest rate (decimal)

n = the number of compound periods

As per the question, data will be given as:

p = $5,000

r = 3.2%

t = 10 years

A = P(1+r/100)ⁿ

Substitute the values of p,r, and t in the formula,

A = 5,000 (1 + 3.2/100)¹⁰

A = 5,000 (1 + 0.032)¹⁰

A = 5,000 (1.032)¹⁰

A = 6,851.2052

Rounded to the nearest cent

A = 6,851.2

Therefore, the amount of money would be $6,851.2 in the account after 10 years.

To learn more about Compound interest click here:

brainly.com/question/25857212

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