Eva invests 8100 in a new savings account which earns 4.5% annual interest, compounded semi-annually. What will be the value of her investment after 2 years? Round to the nearest cent.

Solution

Solution

Amount : 8853.97

Solution steps

Translate the problem into an equation:

A = 8100 (1 + \frac{0.045}{2})^{2 \cdot 2}

8100 (1 + \frac{0.045}{2})^{2 \cdot 2} = 8853.97488 \dots

Round to the nearest hundredth:

8853.97

Amount : 8853.97

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