Question

You need $94,000 in 8 years. If you can earn .61 percent per month, how much will you have to deposit today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

Answer 1

Answer: need to invest $52,720.84

Explanation:

$94,000 in 8 years. If you can earn .61 percent per month

Our formula is:

A = P*(1 + r/n)^(nt)

I assume interest is compounded monthly

r/n = 0.61%
t = 8

A=$94,000

94,000= P*(1+0.0061)^12*8

94,000 =P * (1.0061)^96

P = 94000/ [1.0061^96]
P = 94000/1.782976

P= 52,720.8443

Need to invest about $52,720.84

from MysticAlanCheng