Need help on Compound Interest and Present Value
Shelly Katz deposited $30,000 in a savings account at 5% interest compounded semiannually. At the beginning of year 4, Shelley deposits an additional $80,000 at 5% interest compounded semiannually. At the end of 6 years, what is the balance in Shelley's account?
Re: Need help on Compound Interest and Present Value
Could you tell us what you've tried so far, or just where your difficulty is? I could do the problem, but I'm not sure that would help you.
Here's a thought. Start at "time zero" (you can think of "time zero" as a date on the calendar, maybe January 1, 2000 if that seems to help) with $30K. The interest is compounded semiannually. What happens after six months (half a year)?