SOLUTION: A bank offers a CD that pays a simple interest rate of 7.5​%. How much must you put in this CD now in order to have ​$4 comma 000 for a​ home-entertainment center in 3 years.

Algebra.Com
Question 1206375: A bank offers a CD that pays a simple interest rate of 7.5​%. How much must you put in this CD now in order to have ​$4 comma 000 for a​ home-entertainment center in 3 years.
Answer by ikleyn(52770)   (Show Source): You can put this solution on YOUR website!
.
A bank offers a CD that pays a simple interest rate of 7.5​%. How much must you put
in this CD now in order to have ​$4 comma 000 for a​ home-entertainment center in 3 years.
~~~~~~~~~~~~~~~~~~~~~~ 

The formula for the future value of a simple interest deposit is

    FV = .


Here FV = $4000 (given);  X is the unknown value of the one-time amount deposited today;
r is the annual rate (0.075, given);  t is the time in years (3 years, given).


From this formula,  X =  =  = 3265.31  (rounded).


ANSWER.  $3265.31 should be deposited today.

Solved.



RELATED QUESTIONS

A bank offers a CD that pays a simple interest rate of ​6.0%. How much must you put in... (answered by ikleyn,math_tutor2020)
A bank offers a CD that pays a simple interest rate of ​2.5%. How much must you put in... (answered by Theo)
A bank is offering a CD that pays an annual simple interest rate of 4.5%. How much money... (answered by jorel1380)
You want to buy a new camera for Christmas by saving $1,999 in only eight months. You... (answered by jim_thompson5910,MathTherapy)
1st question: The principal P is borrowed at a simple interest rate r for a period of (answered by ikleyn)
You have a total of $5,000 and decide to invest part in a bank paying 5% simple interest... (answered by checkley75)
Graduation is 5 years away and you want to have $950 available for a trip. If your bank... (answered by Boreal)
Graduation is 3 years away and you want to have $850 available for a trip. If your bank... (answered by jorel555)
Graduation is 3 years away and you want to have $1400 available for a trip. If your bank... (answered by josmiceli)