A child's grandparents purchased a $10,000 bond fund maturing in 18 years to be used for her college education. The bond fund pays 4% compounded semi-annually. How much will the bond fund be worth at maturity?
You will need to use compound interest formula:
MV = S(1 + r)^n ...
The solution provides explanations on the concept of compound interest and includes step-by-step calculations.