Asked by Sarah Radwan on Jun 17, 2024
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Krista invested $18,000 in a 3-year regular-interest GIC earning 4.2% compounded semi-annually. What is the semi-annual interest payment?
Compounded Semi-annually
Refers to the process where the interest earned on an investment is calculated and added to the principal amount every six months.
GIC
A Guaranteed Investment Certificate, particular to the Canadian market, ensures investors a promised rate of return within a set duration.
Semi-annual Interest
Interest that is calculated and paid twice a year on an investment or loan.
- Learn and utilize the principle of compound interest, performing calculations for a range of compounding frequencies.
- Compute the future valuation of investments subject to different interest rates, time spans, and compounding frequencies.
Verified Answer
AS
Learning Objectives
- Learn and utilize the principle of compound interest, performing calculations for a range of compounding frequencies.
- Compute the future valuation of investments subject to different interest rates, time spans, and compounding frequencies.