document.write( "Question 1202014: A couple plans to save for their child's college education. What principal must be deposited by the parents when their child is born in order to have $39,000 when the child reaches the age of 18? Assume the money earns 9% interest, compounded quarterly. (Round your answer to two decimal places.) \n" ); document.write( "

Algebra.Com's Answer #836636 by ikleyn(52798) $\"\"$ $\"About$

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\n" ); document.write( "A couple plans to save for their child's college education.
\n" ); document.write( "What principal must be deposited by the parents when their child is born in order
\n" ); document.write( "to have $39,000 when the child reaches the age of 18?
\n" ); document.write( "Assume the money earns 9% interest, compounded quarterly.
\n" ); document.write( "(Round your answer to two decimal places.)
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document.write( "Use the formula for discretely compounded account \r\n" );
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document.write( "      f = p * (1 + r) ^ n\r\n" );
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document.write( "where f is the future value\r\n" );
document.write( "      p is the principal (the deposited amount)\r\n" );
document.write( "      r is the interest rate per time period, presented as a decimal\r\n" );
document.write( "      n is the number of time periods.\r\n" );
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document.write( "Your time periods are quarters.\r\n" );
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document.write( "f = 39000 dollars.\r\n" );
document.write( "r = 0.09/4.\r\n" );
document.write( "n = 18 years * 4 = 72 quarters.\r\n" );
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document.write( "Formula becomes 39000 = ,  which gives\r\n" );
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document.write( "    p =  = 7857.89  to the nearest cent.    ANSWER\r\n" );
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\n" ); document.write( "\n" ); document.write( "To see many other similar (and different) solved problems on compounded interest accounts, look into the lesson\r
\n" ); document.write( "\n" ); document.write( " - Compounded interest percentage problems \r
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\n" ); document.write( "\n" ); document.write( "Learn the subject from there.\r
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