Question 1120274: Please R=6%,T=8year,A=19125 how do you solve p and I
Answer by Theo(13342)   (Show Source):
You can put this solution on YOUR website! if your problem has to do with annual compounding, then you would use the following calculator.
https://arachnoid.com/finance/
if A = 19125 is the future value, then you would do what is shown below, with all fields being input by you except for the present value field, which you would ask the calculator to compute for you.
the calculator tells you that the present value is 11,999.26.
annual payment is 0 and payment at end or beginning of time period doesn't apply.
if future value is positive, then present value will be negative.
if future value is negative, then present value will be positive.
it's a cash flow thing.
money going out is negative.
money coming in is positive.
if A = the annuity, then you would do what is shown below, with all fields being input by you except for the present value field, which you would ask the calculator to compute for you.
payment is assumed to at at the end of each time period.
future value is set to 0.
present value becomes 118,762.31
the payment is entered as negative since4 it is assume to be money going out.
that makes the present value positive since it is assumed it was a loan that you received up front that you are paying off at the end of each year.
if the money each year is payment to you, then the present value will be negative because it is assumed you deposited the money in an account that you could draw from at the end of each year.
if your problem is not one of these, then you will need to be able to provide more details, such as what A represents and whether this is discrete compounding (as above), or continuous compounding, or simple / flat interest.
there are formulas that can be used but i won't bore you with those unless you absolutely need to have them.
they are in the following reference.
https://www.algebra.com/algebra/homework/Finance/THEO-2016-04-29.lesson#notes
when using the calculator, interest is entered as percent.
when using the formula, interest is entered as decimal equivalent.
for example, if percent = 6, then decimal equivalent = .06.
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