if $3000 is deposited at the end of each half year in an account that earns 64% compounded semiannually, after how many half years will the account contain $140,000 (Round your answer UP to the nearest half year) half years

Finance Nov 27, 2020

Expert Solution

Here, C = $3,000

Semiannual rate = 6.4%/2 = 3.2%

time t = ?

Future Value F = $140,000

F = (C/r)*((1+r)^t-1)

140000 = (3000/3.2%)*(1.032^t-1)

1.032^t-1 = 1.4933

1.032^t = 2.4933

t = log(1.032)(2.4933)

= 29.0

hence it will take 29 half years to make $140,000

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