Find the future value of the annuity due.
-Payments of $\$ 2500$ made at the beginning of each semiannual period for 8 years at $4 \%$ compounded semiannually
A) $\$ 44,098.21$
B) $\$ 47,530.18$
C) $\$ 23,956.99$
D) $\$ 40,733.54$

Question

Quizplus · Accepted Answer

The future value of an annuity due can be calculated using the formula $ FV = P \times \frac{(1 + r)^n - 1}{r} \times (1 + r) $, where $ P $ is the payment amount, $ r $ is the interest rate per period, and $ n $ is the total number of periods. Here, $ P = 2500 $, $ r = 0.02 $ (4% annually, 2% semiannually), and $ n = 16 $ (8 years, semiannual). Calculating gives approximately $\$ 47,530.18$.

Find the Future Value of the Annuity Due $2500\$ 2500$2500 Made at the Beginning of Each Semiannual Period for 8

Find the Future Value of the Annuity Due $\$ 2500$ Made at the Beginning of Each Semiannual Period for 8