How much is 4000 worth after 20 Semi-Annuallys using an annual interest rate of 2.50% compounded Semi-Annually?

<-- Start Balance
<-- # of periods
<-- Interest rate
              

How much is 4000 worth after
20 semi-annual periods
using an annual interest rate of 2.50%
compounded semi-annual?

Calculate effective interest rate

There are 2 semi-annual periods in a year
Convert interest rate to semi-annual
Semi-Annually Interest  =  Annual Interest Rate
  Compounding Periods

Semi-Annually Interest  =  0.025
  2

Semi-Annually Interest = 0.0125

Calculate Accumulated Balance

A = B(1 + i)n
where A = accumulated balance
B = opening balance
i = Semi-Annually interest rate
and n = number of periods

Plugging in our values

A = 4000(1 + 0.0125)20
A = 4000(1.0125)20
A = 4000(1.2820372317086)
A = 5,128.15

How much interest was earned?

Interest Earned = Accum. Value - Start Balance

Plug in our values

Interest Earned = 5,128.15 - 4,000.00
Interest Earned = 1,128.15








What is the Answer?

A = 5,128.15
Interest Earned = 1,128.15

How does the Compound Interest Accumulated Balance Calculator work?

Free Compound Interest Accumulated Balance Calculator - Given an interest rate per annum compounded annually (i), semi-annually, quarterly, monthly, semi-monthly, weekly, and daily, this calculates the accumulated balance after (n) periods
This calculator has 3 inputs.

What 1 formula is used for the Compound Interest Accumulated Balance Calculator?

  1. Bn = Bn - 1(1 + i)

For more math formulas, check out our Formula Dossier

What 5 concepts are covered in the Compound Interest Accumulated Balance Calculator?

compound interest
the interest you earn on principal and interest
A = (1 + r/n)nt
compound interest accumulated balance
interest rate
the proportion of a loan that is charged as interest to the borrower or proportion of principal credit given to a depositor
principal
The amount borrowed on a loan, before interest is charged
yield
How much an investment returns in terms of interest rate

Example calculations for the Compound Interest Accumulated Balance Calculator

  1. 2000 for 20 periods at 6% monthly
  2. 1050 for 10 periods using 5.25 percent compounded daily

Compound Interest Accumulated Balance Calculator Video


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