How much money would you need to deposit today at 5% annual interest compounded monthly to have $20000 in the account after 9 ye

Question

Y_Kistochka [10]

3 years ago

14

How much money would you need to deposit today at 5% annual interest compounded monthly to have $20000 in the account after 9 ye

ars?

Mathematics

2 answers:

mario62 [17] · Answer 1 · 2021-12-10T20:19:42+03:00

mario62 [17]3 years ago

7 0

20000=p(1+0.05/12)^12*9
Solve for p
P=20,000÷(1+0.05÷12)^(12×9)
P=12,764.49

Nana76 [90] · Answer 2 · 2021-12-10T21:40:57+03:00

Nana76 [90]3 years ago

5 0

$12,764.49 because 9 yrs = 108 months
<span>5% annual = (5/12)% per month = 5/1200
</span><span>FV = PV*(1 + 5/1200)^108 = 20000
PV = 20000/(1 + 5/1200)^108
PV = $12,764.49</span>