Question

you find a mutual fund that offers approximately 4 % APR compounded monthly. How much will you need to invest each month for the next 6 months in order to have $500?

Answer 1

Answer: $82.64

Explanation:

Answer 2

amount need to invest in a month = $ 40.84

Explanation:

given data

Future value A = $500

interest rate r = 4% = 0.04

Time period t = 6 month = 0.5 year

solution

we get here future value formula that is

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

here n is 12 in a year and r is are and t is time period

put here value and we get

$500 =
`P* (1+(0.04)/(12))^(12* 0.5)`

solve it we get

P = $490.11

so amount need to invest in a year= $490.11

and amount need to invest in a month =
`(490.11)/(12)`

amount need to invest in a month = $ 40.84