Question

You placed $6,011 in a savings account today that earns an annual interest rate of 12.46 percent, compounded semiannually. How much will you have in this account at the end of 11 years? Assume that all interest received at the end of the period is reinvested the next period. Round the answer to two decimal places. nal places. Your Answer:

Answer 1

Answer

• No of year = 11
• Semi Annual compounding = 11 x 2 = 22 Periods.
• Working

Period	Beginning balance	Interest earned	Ending balance
	[A]	[B = A x 12.46% x 6/12]	[C = A+B]
1	$6,011.00	$374.49	$6,385.49
2	$6,385.49	$397.82	$6,783.30
3	$6,783.30	$422.60	$7,205.90
4	$7,205.90	$448.93	$7,654.83
5	$7,654.83	$476.90	$8,131.72
6	$8,131.72	$506.61	$8,638.33
7	$8,638.33	$538.17	$9,176.50
8	$9,176.50	$571.70	$9,748.19
9	$9,748.19	$607.31	$10,355.51
10	$10,355.51	$645.15	$11,000.65
11	$11,000.65	$685.34	$11,686.00
12	$11,686.00	$728.04	$12,414.03
13	$12,414.03	$773.39	$13,187.43
14	$13,187.43	$821.58	$14,009.00
15	$14,009.00	$872.76	$14,881.77
16	$14,881.77	$927.13	$15,808.90
17	$15,808.90	$984.89	$16,793.79
18	$16,793.79	$1,046.25	$17,840.05
19	$17,840.05	$1,111.43	$18,951.48
20	$18,951.48	$1,180.68	$20,132.16
21	$20,132.16	$1,254.23	$21,386.39
22	$21,386.39	$1,332.37	$22,718.77 ANSWER

• At the end of 11 years, the account will have an Account balance of around $ 22718.77