SOLUTION: How much would i have to invest at 3% interest compounded annually in order to have $16,000.00 at the end of seven years?

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Question 715072: How much would i have to invest at 3% interest compounded annually in order to have $16,000.00 at the end of seven years?
Answer by Edwin McCravy(20054)   (Show Source): You can put this solution on YOUR website!
How much would i have to invest at 3% interest compounded annually in order to have $16,000.00 at the end of seven years?
We use the formula

A = P(1 + )n·t

in which

A = the final amount of dollars = $16,000.00
P = the biginning amount of dollars = ??
r = the rate expressed as a decimal = 0.03
n = the number of times per year the interest is compounded = 1
t = the number of years = 7

                  16000 = P(1 + )1·7

                  16000 = P(1 + 0.03)7

                  16000 = P(1.03)12

                  16000 = P(1.425760887)

                = P

              $11222.08 = P



Edwin
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