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Semiannual compounding implies that interest is compounded times per year. You have deposited $96,780 into an account that will earn an interest rate of 9% compounded semiannually. How much will you have in this account at the end of four years?

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Answer:

Final Value= $137,630.90

Explanation:

Giving the following information:

You have deposited $96,780 into an account that will earn an interest rate of 9% compounded semiannually.

n= 4*2= 8

To calculate the final value we need to use the following formula:

FV= PV*(1+i)^n

PV= 96,780

i= 0.09/2= 0.045

n=8

FV= 96,780*(1.045)^8= $137,630.90

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