3 Questions
What is the difference between the amount compounded annually and the amount compounded semi-annually after 4.5 years?
$8000 \left(1 + \frac{10}{100}\right)^{4.5} - 8000 \left(1 + \frac{10}{2 \times 100}\right)^{2 \times 4.5}$
What is the effective annual rate when the interest is compounded semi-annually at 10%?
$\left(1 + \frac{0.10}{2}\right)^2 - 1$
What is the future value of an investment of $8000 after 3 years when the interest is compounded annually at 8%?
$8000\left(1 + \frac{8}{100}\right)^3$
Test your knowledge of compound interest calculation with this quiz based on a $8000 investment at 10% annual interest after 41/2 years.
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