document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=768240>Question 768240</A>: <I><SPAN STYLE=\"word-break: break-all;\"> Pete figures he'll need a new car in about 5 years. He believes he'll need about $15,000 and plans on depositing his money into an account with a 12% interest rate compounded semiannually. How much does Pete need to deposit? </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #468167 by </B><A HREF=/tutors/aboutme.mpl?userid=lwsshak3><B>lwsshak3(11628)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=lwsshak3><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/images/nopicture.jpg><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=468167\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> Pete figures he'll need a new car in about 5 years. He believes he'll need about $15,000 and plans on depositing his money into an account with a 12% interest rate compounded semiannually. How much does Pete need to deposit?<BR>\n" );
document.write( "***<BR>\n" );
document.write( "Compound Interest Formula: A=P(1+i)^n, P=initial investment, i=interest rate per compounding period,<BR>\n" );
document.write( "n=number of compounding periods, A=amount after n-periods.<BR>\n" );
document.write( "For given problem:<BR>\n" );
document.write( "P=?<BR>\n" );
document.write( "i=.12/2=.06<BR>\n" );
document.write( "n=5*2=10<BR>\n" );
document.write( "A=$15000<BR>\n" );
document.write( "..<BR>\n" );
document.write( "15000=P(1+.06)^10<BR>\n" );
document.write( "15000=P(1.06)^10<BR>\n" );
document.write( "P=15000/(1.06)^10<BR>\n" );
document.write( "P=8375.92<BR>\n" );
document.write( "How much does Pete need to deposit? $8376 </SPAN>\n" );
document.write( "</TD></TR></TABLE>\n" );