The first step to answering this item, is to determine the effective interest which can be calculated by the equation,
ieff = (1 + i/n)^m - 1
Substituting the known value,
ieff = (1 + 0.05/2)^2 - 1 = 0.050625
The future worth of the investment made at a certain period is find through the equation,
F = P x (1 + ieff)^t
where P is the present worth, F is the future worth, and t is the number of years. Substituting the known values,
F = (4000) x (1 + 0.050625)^10
F = 6554.47
ANSWER: 6554.47
