1. **State the problem:** Azhar wants to have 20000 in his bank account 5 years from today. The bank pays 6% interest compounded semi-annually. We need to find how much money he should deposit today. 2. **Formula used:** For compound interest, the future value $A$ is related to the present value $P$ by the formula: $$A = P \left(1 + \frac{r}{n}\right)^{nt}$$ where: - $A$ is the amount of money accumulated after $t$ years, including interest. - $P$ is the principal amount (the initial money). - $r$ is the annual interest rate (decimal). - $n$ is the number of times interest applied per year. - $t$ is the number of years. 3. **Given values:** - $A = 20000$ - $r = 0.06$ - $n = 2$ (since interest is compounded semi-annually) - $t = 5$ 4. **Rearrange formula to find $P$:** $$P = \frac{A}{\left(1 + \frac{r}{n}\right)^{nt}}$$ 5. **Calculate:** $$P = \frac{20000}{\left(1 + \frac{0.06}{2}\right)^{2 \times 5}} = \frac{20000}{\left(1 + 0.03\right)^{10}} = \frac{20000}{1.03^{10}}$$ 6. **Evaluate $1.03^{10}$:** $$1.03^{10} \approx 1.34392$$ 7. **Calculate $P$:** $$P = \frac{20000}{1.34392} \approx 14875.38$$ **Answer:** Azhar needs to put aside approximately 14875.38 today to have 20000 in 5 years with 6% interest compounded semi-annually.