Two years

Roy deposited 50,000.00 into his account, which pays 4% annual interest compounded semi-annually. How much interest is there after two years?

Correct answer:

i =  4121.608

Step-by-step explanation:

$$\begin{gathered} a=50000 \\ p=4\%=\frac{4}{100}=\frac{1}{25}=0.04 \\ k=1+p/2=1+0.04/2=\frac{51}{50}=1\frac{1}{50}=1.02 \\ i=a\cdot k^{2\cdot 2}-a=50000\cdot 1.02^{2\cdot 2}-50000=4121.608 \end{gathered}$$

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