Business and Finance

User Generated

fyvzpnfu50

Business Finance

Question Description

A business person invest $3281 at 2% compounded semiannually for 2 years. What is the future value of investment? How much interest will be earned over a two year period? Round to nearest cent as needed.

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Explanation & Answer

A=P(1+r/100)^n

  = 3281(1+1/100)^4

   = 3281(101/100)^4

   =3281(1.01)^4

   =3281 *1.040

   = 3412.24

future value $ 3412

interest = amount - principal

            =3412-3281

            =$ 131

juteno (12526)
Duke University

Anonymous
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