Kiki is saving money in an annuity and is earning 10% annual interest compounded semi-annually. If she deposits $2,000 every 6 months for 3 years, what will the future value of her account equal? How much interest will she have earned?
The formula for annual compound interest is A = P (1 + r/n) ^ nt:
A = the future value of the investment/loan, including interest P = the principal investment amount (the initial deposit or loan amount) r = the annual interest rate (decimal) n = the number of times that interest is compounded per year t = the number of years the money is invested or borrowed for