Interest compounded semiannually is compounded four times a year.

Compounded Semiannually

The process of calculating interest on both the initial principal and the accumulated interest from previous periods twice a year.

Compounded Annually

Interest calculation method where the interest earned is added to the principal at the end of each year, then the new total earns interest.

Understand and correct common misconceptions about how often interest is compounded annually.

Verified Answer

Final Answer :

False

Explanation :

Interest compounded semiannually is compounded twice a year, not four times a year.

Learning Objectives

Understand and correct common misconceptions about how often interest is compounded annually.