Question

you invest money in an account that earns 8% continuously. you want the invest meant to be equal to 50,000 in 10 years. how much do you need to invest initially.

Answer 1

b

Step-by-step explanation:

Answer 2

We need to invest approximately $23,269.09 initially. To find out how much money we need to invest initially, we can use the formula for continuous compound interest.

Step-by-step explanation:

To find out how much money we need to invest initially, we can use the formula for continuous compound interest:

A = P * e^(rt)

Where:

• A is the final amount you want to have ($50,000)
• P is the principal amount you need to invest initially
• e is the base of the natural logarithm (~2.71828)
• r is the interest rate (8% or 0.08)
• t is the time period (10 years)

Plugging in the values:

50,000 = P * e^(0.08 * 10)

Simplifying the equation:

P = 50,000 / e^(0.8)

Using a calculator, we get:

P ≈ 23,269.09

Therefore, we need to invest approximately $23,269.09 initially.