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klemol [59]
3 years ago
10

A

Mathematics
1 answer:
sweet [91]3 years ago
5 0

Answer:

Intital investment= £6,911.57

Step-by-step explanation:

Giving the following information:

Future Value (FV)= £8,001

Number of periods (n)= 3 years

Interest rate (i)= 5% = 0.05 compounded annually

<u>To calculate the initial investment (PV) needed to reach £8,001 (over £8,000) in 3 years, we need to use the following formula:</u>

PV= FV / (1+i)^n

PV= 8,001 / (1.05^3)

PV= £6,911.57

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