Question

3.
Find the compound amount. Round to the nearest cent.

Amount: $23,400
Rate: 3%
Compounded: semiannually
Time (Years): 10


A.)$31,516.52

B.)$27,156.64

C.)$26,910.00

D.)$31,447.73

Answer 1

Correct Answer: Option A

Principal Amount = P = $23,400
Interest rate = r = 3% = 0.03
Time = t = 10
Number of compounding periods in a year = n = 2
Compounded amount = A = ?

Formula for compound interest is:

$A = P(1+ \frac{r}{n} )^{t*n}$

Using the values, we get:

$A=23400(1+ \frac{0.03}{2})^{2*10}=31516.41$

Option A is the closest one, so its the correct answer