Can someone help me find the balance? thanks a lot?

Question

Find the balance in the account.

You deposit $750 in an account with 7% interest compounded semiannually. What is the balance in the account after 4 years??

Answer 1

It's about $990

Compound interest calculator.  

http://www.money-zine.com/Calculators/Re...

Answer 2

The simplest way is to take the original $750 and multiply it times .07.  You get $49.50.  Add that to the original $750 and you have $799.50.  Now take that and multiply it times .07 again.  You get $54.9650.  Add THAT to the $799.50 (not the original $750!!) and you get 854.465.  Now you know how much it made for the first year because it is BI-ANNUAL and you did it twice.  (Don't round it off till you get the entire four years.)

To figure out the rest of the years, keep doing the same thing.  Take the $854.466 and multiply by .07 and add the answer back to the number you started with (the $854.466).  

There is a formula for figuring out the interest that is quicker, though.

The formula for simple interest is I = Prt

In order to determine any of the variables (I, P, r, t) you only need the other 3

When you know three of the four values, here's how you calculate the unknown.

To find principal (P) P = I/rt

To find the interest rate (r) r = I/Pt

To find the period of time (t) t = I/Pr

Understand?  Using a calculator is all well and good, but what if you don't have a calculator at hand?  That's why you need to learn HOW to do these.  

Hope this helps.

:)