You have $ 1,000 invested in an account which pays 16 percent compounded annually

You have $ 1,000 invested in an account which pays 16 percent compounded annually

Subject: Business    / Finance
Question

You have $ 1,000 invested in an account which pays 16 percent compounded annually. A commission agent (called a “finder”) can locate for you an equally safe deposit which will pay 16 percent, compounded semi-annually, for 2 years. What is the maximum amount you should be willing to pay him now as a fee for locating the new account?

A. a. $5.63

B. b. $10.95

C. c. $17.15

D. d. $16.94

E. e. $20.15