SOLUTION: When Dennis turns 18, his parents will give him money tgat they invested for him when he was born. They invested the money in a savings account that had a interest rate of 7.2%

Question 1122961: When Dennis turns 18, his parents will give him money tgat they invested for him when he was born. They invested the money in a savings account that had a interest rate of 7.2% compounded monthly. If they will give him$91001.31, how much did they initially invest?
Answer by Theo(13342) (Show Source): You can put this solution on YOUR website!
i used the following financial calculator.

https://arachnoid.com/finance/

the calculator tells me that the money invested was $24,996.77.

i provided the calculator with the following inputs.

present value = 0
future value = 91001.31
number of time periods = 18 * 12 = 216 months
payment each time period = 0
interest rate % per time period = 7.2/12 = .6% each month.
payment each time period is made at the end of each time period (not required since there was no payment made om each time period).

i also use the texas instruments BA-II financnial calculator and it told me the same thing.

it looks very much like the initial investment was $25,000, but that would have led to a future value of 91,013.09, a very slight difference than the amount you showed.

here's what the online calculator showed me.

$$$

if you need formulas, they can be found here:

https://www.algebra.com/algebra/homework/Finance/THEO-2016-04-29.lesson#notes

i'll be available to answer any questions you might have regarding this.

when you use the calculator, you enter any money that is going out as negative and any money that is coming in as positive.

i entered positive future value and the calculator gave me negative present value.

the present value was money going out and the future value was money coming in.

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