Answer:
Sum = $1.073
Interest = $0.073
Step-by-step explanation:
Given that $1 is invested for one year at 7.2% interest which compounds semi-annually.
Semi-annual means there should be two equal intervals in a year i.e. 6 months interval.
Now, the semi-annual rate of interest is [tex]\frac{7.2}{2} = 3.6[/tex]%.
Therefore, the invested money will become [tex]1\times [1 + \frac{3.6}{100} ]^{2}[/tex]
= $1.073
Therefore, the interest obtained will be $(1.073 - 1) = $0.073. ( Answer )
