Question

By using the table in the handbook, the present value of $12,000 for six years compounded at 6 percent semiannually is

Answer 1

semi annually for six years will give 12 time periods. use the formula

\[A = P(1 + \frac{r}{100})^n\]

A = future value
P = Principal P = 12,000
r = interest rate r = 6
n = time periods n = 12

substitute and then find th value

Answer 2

A = 12,000 ( 1 + .06/2) ^12