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25 February, 07:22

Wilma saves $12,000 at the end of every six months for 10 years. Assume 10% compounded semiannually and find the present value.

$73,734.84

$137,547.52

$195,589.79

$149,546.52

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Answers (1)
  1. 25 February, 10:48
    0
    Here we use the formula for compound interest given by:

    A=p (1+r/100*n) ^ (nt)

    where:

    A=amount=

    p=principle=12000

    r=rate=0.1

    n=# terms=2

    t=time=10 years

    thus;

    A=12000 (1+0.1/2) ^ (2*10)

    A=31839.6
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