Question

The manager of a technology store wants to save $20,000 in 3 years to make a down payment on a condominium. How much (in dollars) does the manager need to invest at the beginning of each week into an account that earns 7.25% interest compounded weekly

Answer 1

$16,104.35

Explanation:

the expression for compound interest is given as

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

A=$20,000

P=?

r=7.25%=0.0725

n=52 weeks

t=3 year

`20000= P(1 + (0.0725)/(52))^(52*3)\\\\20000= P(1 + (0.0725)/(52))^(156)\\\\20000= P(1 +0.00139)^(156)\\\\20000= P(1.00139)^(156)\\\\20000=1.2419P\\\\P=20000/1.2419\\\\P=16104.35\\`

the manager need to invest $16,104.35