SOLUTION: Ricky and Krystal have a new grandson. How much money should they invest now so that he will have $63,000 for his college education in 18 years? The money is invested at 5.6% compo

Algebra ->  Customizable Word Problem Solvers  -> Finance -> SOLUTION: Ricky and Krystal have a new grandson. How much money should they invest now so that he will have $63,000 for his college education in 18 years? The money is invested at 5.6% compo      Log On

Ad: Over 600 Algebra Word Problems at edhelper.com


    

Question 1146229: Ricky and Krystal have a new grandson. How much money should they invest now so that he will have $63,000 for his college education in 18 years? The money is invested at 5.6% compounded quarterly.
Answer by Boreal(15235) About Me  (Show Source):
You can put this solution on YOUR website!
P=Po(1+r/n)^nt
63000=Po(1+.056/4)^72, since there will be 72 quarters in 18 years
63000=Po(1.014^72)
Po=63000/2.72 round at end
=$23153.03