SOLUTION: The present value P that will amount to A dollars in n years with interest compounded annually at annual interest rate r, is given by: P = A (1 + r)^-12 power Find the present

Algebra ->  Polynomials-and-rational-expressions -> SOLUTION: The present value P that will amount to A dollars in n years with interest compounded annually at annual interest rate r, is given by: P = A (1 + r)^-12 power Find the present       Log On


   

Question 146505This question is from textbook
: The present value P that will amount to A dollars in n years with interest compounded annually at annual interest rate r, is given by:
P = A (1 + r)^-12 power
Find the present value that will amount to $50,000 in 20 years at 8% compounded annually.
 This question is from textbook

Found 2 solutions by checkley77, edjones:
Answer by checkley77(12844) About Me  (Show Source):
You can put this solution on YOUR website!
P = A (1 + r)^-12 power
THE PROPER FORMULA IS:
P=A(1+R)^T
P=50,000(1+.08)^20
P=50,000(1.08)^20
P=50,000*4.66
P=$233,048 AMOUNT OF INVESTMENT AFTER 20 YEARS @ 8% ANNUAL RATE.

Answer by edjones(8007) About Me  (Show Source):
You can put this solution on YOUR website!
Your formula should be P=A(1+r)^-20 (for 20 years)
P=50000(1+.08)^-20
=$10,727.41
.
Ed