document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=768239>Question 768239</A>: <I><SPAN STYLE=\"word-break: break-all;\"> Richard and Colleen want to save for a boat. They estimate that they'll need about $4,500 in 7 years. Their bank offers a 2% interest rate compounded semiannually. How much would they need to deposit now in order to have $4,500 in 7 years? </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #468181 by </B><A HREF=/tutors/aboutme.mpl?userid=stanbon><B>stanbon(75887)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=stanbon><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=468181\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> Richard and Colleen want to save for a boat. They estimate that they'll need about $4,500 in 7 years. Their bank offers a 2% interest rate compounded semiannually. How much would they need to deposit now in order to have $4,500 in 7 years?<BR>\n" );
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document.write( "A(t) = P(1+(r/n))^(nt)<BR>\n" );
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document.write( "4500 = P(1+(0.02/2))^(2*7)<BR>\n" );
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document.write( "4500 = P(1.1)^14<BR>\n" );
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document.write( "P = 4500/1.1^14 = $1184.99<BR>\n" );
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document.write( "Cheers,<BR>\n" );
document.write( "Stan H.<BR>\n" );
document.write( "========== </SPAN>\n" );
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