Question

Mason is going to invest in an account paying an interest rate of 5.3% compounded

quarterly. How much would Mason need to invest, to the nearest hundred dollars,

for the value of the account to reach $205,000 in 14 years?

Answer 1

98100

Explanation:

Answer 2

$98,089.74

Explanation:

The computation of the invested amount i.e. present value is shown below:

As we know that

Present value = Future value ÷ (1 + rate of interest)^years

= $205,000 ÷ (1 + 0.053 ÷4)^4 × 14

= $205,000 ÷ (1.01325)^56

= $98,089.74