You deposit $3000 into a bank account that pays 1.25% annual interest, compounded semi-annually. What is the final balance after

Question

3 years ago

14

4 years

1 answer:

mojhsa [17] · Answer 1 · 2022-03-31T12:45:59+03:00

Answer:

$3,153.32

Step-by-step explanation:

Given that

The deposited amount is $3,000

The annual interest rate is 1.25%

So, the semi-annual interest rate is 1.25% ÷2 = 0.625%

And, the time period = 4 × 2 = 8

We need to find out the final balance

So,

As we know that

Future value = Present value × (1 + rate of interest)^number of years

= $3,000 × (1 + 0.625%)^8

= $3,153.32