If you put $2,000 in a savings account that yields 8% compounded semiannually,how much money will you have in the account in 20 years (rounded to nearest $10)?
A) $6,789
B) $8,342
C) $9,602
D) $9,972

Question

Quizplus · Accepted Answer

The formula for compound interest is A = P(1 + r/n)^(nt), where A is the amount of money accumulated after n years, including interest, P is the principal amount ($2,000), r is the annual interest rate (8% or 0.08), n is the number of times that interest is compounded per year (2 for semiannually), and t is the time the money is invested for in years (20). Plugging in the values: A = 2000(1 + 0.08/2)^(2*20) = $9,602 (rounded to the nearest $10).

If You Put $2,000 in a Savings Account That Yields