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MYP Maths, Financial Mathematics, Compound Interest

How can we calculate the interest paid on a deposit of $6000 at 6% per annum compounded semi-annually for 2 years?

Thanks

How can we calculate the interest paid on a deposit of $6000 at 6% per annum compounded semi-annually for 2 years?

Thanks

- Lucas
**Posts:**0**Joined:**Mon Jan 28, 2013 8:05 pm

MYP Mathematics, Financial Mathematics, Compound Interest

Compounded semi-annually means interest is added to the principal semi-annually.

The general compounding formula is:

and

Where F is the future value of the investment, P the principal, r is the interest rate per compound period and n is the number of compounding periods.

Regarding your question about the interest paid we will use the following formula

Hope these help!

Compounded semi-annually means interest is added to the principal semi-annually.

The general compounding formula is:

and

Where F is the future value of the investment, P the principal, r is the interest rate per compound period and n is the number of compounding periods.

Regarding your question about the interest paid we will use the following formula

Hope these help!

- miranda
**Posts:**268**Joined:**Mon Jan 28, 2013 8:03 pm

thanks miranda!!

- Lucas
**Posts:**0**Joined:**Mon Jan 28, 2013 8:05 pm

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