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Question 1190559: How much money should be invested at 5% compounded quarterly for
20 years so that you have P20,000 at the end of 20 years?
Answer by ikleyn(52788)   (Show Source):
You can put this solution on YOUR website! .
How much money should be invested at 5% compounded quarterly for
20 years so that you have P20,000 at the end of 20 years?
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Use the formula for the future value of the discretely compounded account.
FV =  , (1)
where X is the unknown invested amount under the problem's question.
With the given value FV = P20,000, the equation takes the form
20000 = , (2)
Calculate  = 2.701485 and solve equation (2) for X
X =  = 7403.3356.
Round it to the closest greater cent (centavo ?) to get the ANSWER P7403.34.
CHECK. FV =  = 20,000.01. ! Good enough !
Solved.
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For all details and explanations, look into these two lessons
- Compounded interest percentage problems
- Problems on discretely compound accounts
in this site, and learn the subject from there.
After reading these lessons, you will tackle such problems on your own without asking for help from outside.
Also, you have this free of charge online textbook in ALGEBRA-I in this site
- ALGEBRA-I - YOUR ONLINE TEXTBOOK.
The referred lessons are the part of this online textbook under the topic "Logarithms".
Save the link to this online textbook together with its description
Free of charge online textbook in ALGEBRA-I
https://www.algebra.com/algebra/homework/quadratic/lessons/ALGEBRA-I-YOUR-ONLINE-TEXTBOOK.lesson
to your archive and use it when it is needed.
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