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24 December, 16:25

Lois invests 650 every 6 months at 4.6%/a compounded semi-annually for 25 years. How much interest will she earn after the 25th year

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  1. 24 December, 16:36
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    Future value annuity is given by:

    FV=P[ ((1+r) ^n-1) / r]

    From the information:

    P=650

    r=0.046/2=0.023

    n=25*2=50

    Plugging our values in the formula we get:

    FV=650[ ((1+0.023) ^50-1) / 0.023]

    FV=59837.365
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