Lee Holmes deposited $15,000 in a new savings account at 9% interest compounded semiannually. At the beginning of year 4, Lee deposits an additional $40,000 at 9% interest compounded semiannually. What is the balance in Lee's account?

The balance in Lee's account is $72,680.5

Explanation:

The formula to calculate amount for a compound interest is given as,

A = P (1+r) ^n

Since the interest is compounded semiannually, at the end of year 3, the amount in Lee's account would be = 15000 (1+0.09) ^6 = 15000 (1.09) ^6 = $25,156.50

At the beginning of year 4, she deposits an additional $40,000

At the end of year 4, the amount in Lee's account would be = 40,000 (1+0.09) ^2 = 40,000 (1.09) ^2 = $47,524

Lee's balance = $25,156.50 + $47,524 = $72,680.5