Question

# . I saved \$3,500 per six month period for seven years into my savings account earning...

. I saved \$3,500 per six month period for seven years into my savings account earning 2% compounded annually. After the seven years, I stopped making contributions, but left the money in the bank for another five years, at 2.4% compounded annually.

1. How much do I have in my account at the end of this twelve year period?

b) How much interest did I earn over the 12 year period?

Calculate using ba 2 plus calculator

 ans a) Effective annual interest rate = 2.00% Interest rate compounded semiannual ((1+2%)^(1/2)-1)*2 Interest rate compounded semiannual 1.990% monthly rate = 1.99%/2 0.995% we have to use finanical calculator to solve this Put in calculator, set the calculator at BEGIN mode PV 0 PMT -3500 I 0.995% N 7*2 14 Compute FV \$52,298.90 Future value at 12 year Put in calculator PV (\$52,298.90) PMT 0 I 2.40% N 5 Compute FV \$58,883.32 ans = \$58,883.32 Ans b) Total amount of interest earned = \$9,883.32 58883.32-3500*7*2

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