document.write( "Question 150359: --------------------------------------------------------------------------------
\n" ); document.write( "Investing in stocks.. US small company stocks have returned an average of 14.9% annually for the last 50 years. Use the present value formula from the previous exercise to find the amount invested today in small company stocks that would be worth $1 million in 50 years, assuming that small company stocks continue to return 14.9% annually for the next 50 years.
\n" ); document.write( "The previous question (present value) P=A(1+r)^-n the present value P that will amount to A dollars in n years with interest compounded annually at an anual interest rate r, is given by P=A(1+r)^-n
\n" ); document.write( "Find the present value that will amount to $50,000 in 20 years at 8% compounded annually.
\n" ); document.write( "Thanks for any light you can shed on this. I don't know where to begin and I need to show how I did it. Sheryl \n" ); document.write( "

Algebra.Com's Answer #110451 by stanbon(75887) $\"\"$ $\"About$

You can put this solution on YOUR website!
The previous question (present value) P=A(1+r)^-n the present value P that will amount to A dollars in n years with interest compounded annually at an anual interest rate r, is given by P=A(1+r)^-n
\n" ); document.write( "Find the present value that will amount to $50,000 in 20 years at 8% compounded annually.
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\n" ); document.write( "P = 50000(1+0.08)^(-20)
\n" ); document.write( "P = 50000(1.08)^(-20)
\n" ); document.write( "P = $10727.41
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\n" ); document.write( "Cheers,
\n" ); document.write( "Stan H.
\n" ); document.write( " \n" ); document.write( "

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