Approximately how much principal would need to be placed into an account earning 1.58% interest compounded monthly so that it ha

Question

2 years ago

14

s an accumulated value of $90,597 at the end of 25 years?

1 answer:

Natalija [7] · Answer 1 · 2022-04-18T23:53:59+03:00

Answer:

The initial investment is $821.58

Step-by-step explanation:

Giving the following information:

Future Value (FV)= $90,597

Number of periods (n)= 25*12= 300

Interest rate (i)= 1.58% = 0.0158

<u>To calculate the initial investment, we need to use the following present value (PV) formula:</u>

PV= FV/(1+i)^n

PV= 90,597 / (1.0158^300)

PV= $821.58

The initial investment is $821.58