Question

Jose has determined he needs to have $800,000 for retirement in 30 years. His account earns 6% interest.

a.How much would you need to deposit in the account each month?
b.How much total money will you put into the account?
c.How much total interest will you earn?

Answer 1

A. $285,714.29/360 = $793.65
B. $285,714.29
C. $800,000-285,714.29 = $514,285.71

A. P/T(12)
B. P = A/(1+RT)
C. I = PRT or I = A-P

Answer:
P = $285,714.29

Equation:
P = A / (1 + rt)

Calculation:
First, converting R percent to r a decimal
r = R/100 = 6%/100 = 0.06 per year.

Solving our equation:
P = 800000 / ( 1 + (0.06 × 30)) = 285714.28571429
P = $285,714.29

The principal investment required to get a total amount, principal plus interest, of $800,000.00 from simple interest at a rate of 6% per year for 30 years is $285,714.29.