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In this video, we're going to apply the compound interest formula for a compounded semi -annuali situation.
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So we know that we deposit $14 ,000.
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So the amount a that we will have for time is the principal, $14 ,000.
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And then we have one plus the rate is 5 % as a decimal.
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That's 0 .05, just divide by 100.
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And the number of times that it's compounded per year, if it's semi -annual, that's going to be twice a year.
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So then we're going to put the two here again for the end.
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And we're looking for five years.
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So this gives us the overall amount that we'll have in five years.
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So this is equal to, let's simplify, 14 ,000, and then we have 1 plus 0 .05, which is 0 .025.
00:48
So 1 .025, like that...