Question

How much money should you invest now in order to have $ 60 comma 000$60,000 in 2929 ?years? Assume that the money earns interest at 10.5 %10.5%?, compounded annually. Round to the nearest dollar amount.

Answer 1

Answer:

$3316 should be invested.

Step-by-step explanation:

Since, the amount formula in compound interest is,

$A=P(1+r)^t$

Where, P is the principal amount,

r is the rate per period,

t is the time in years,

Here,

A = $ 60,000,

r = 10.5% = 0.105

t = 29 years,

By substituting value,

$60000=P(1+0.105)^{29}$

$P=\frac{60000}{1.105^{29}}=\ 3316.23415377\approx \ 3316$

Hence, $ 3316 should be invested.