The interest on $6,000 at 6 percent compounded semiannually for 8 years is

Question

anonymous · Answer

$$6000(1.06)^8$$ and a calculator

campbell_st · Answer

is the interest rate per year or per half year...?

anonymous · Answer

oops semi anually good catch 
try 
$$6000(1.03)^{16}$$

anonymous · Answer

how did you come up with 1.06?

campbell_st · Answer

have a look at the 2nd solution posted by satellite...

anonymous · Answer

im confused

campbell_st · Answer

ok... the formula for compound interest is 

A = P(1 + r/100)^n 

A = future value, P = Principal, r is the interest rate n is the number of time periods.. 


you question says the interest is compounded half yearly

so n = 2 x 8  or 16          there are 16 half years in 8 full years


r = 6  or 0.06    if the interest rate is 6% per annum then it becomes 3% per half year. 

so in your question you have 

A = 6000(1 +3/100)^16

does this make sense?

anonymous · Answer

looking on the table I get a 1.6047. If I multiply that by 6000 I get a total of $9,628.20.

campbell_st · Answer

and that answer can be obtained by using the formula above...

anonymous · Answer

how?

campbell_st · Answer

do you have a calculator...?

anonymous · Answer

no

campbell_st · Answer

here is a link to an online calculator... I'll assume your computer doesn't have one. 

just enter, as its written below

$$6000 \times ( 1 + 3 \div 100)^{16} = $$

anonymous · Answer

yeah I have one on my computer, thought you meant a hand calculator..but what the link it should come in handy

anonymous · Answer

$6000(1.03)^{16}$ try this http://www.wolframalpha.com/input/?i=6000%281.03%29^16