What semi-annual payment should be made for her

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Reference no: EM133492962

Question: An employee has contributed with her employer to a retirement program for 20 years a certain amount twice a year. The contribution earns an interest rate of 10% compounded semi-annually. At the date of her retirement the total retirement benefit is Birr 300,000. The retirement program provides for investment of this amount at an interest rate of 10% compounded semi-annually. Semi-annual payments will be made for 20 years to the employee or her family in the event of her death.

Required:

1. What semi-annual payment should she make?

2. What semi-annual payment should be made for her?

3. How much interest will be earned on Birr 300,000 over the 40 years?

Reference no: EM133492962

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