What would be the amount of compound interest on $6,000 invested for 2 years at 9%, compounded semiannually?

Question

Round the answer to the nearest dollar.

a) $7,155
b) $2,160
c) $1,155
d) $1,080

Answer 1

C - $1,155 (amount of Compound Interst)

2 years x 2 (semiannual) = 4 periods
9% rate divided by 2 = 4.5% for each period
$6,000 x 1.1925 (Table factor Lookup) = $7,155
$7,155 - $6,000 = $1,155

Answer 2

4.5% X 6000 = 270
4.5% X 6270 = 282.15
4.5% X 6552.15 = 294.85
4.5% X 6847 = 308.12

total = 7155.12

interest earned = 1155.12

answer is = C

Answer 3

Answer A