Question 715072: How much would i have to invest at 3% interest compounded annually in order to have $16,000.00 at the end of seven years? Answer by Edwin McCravy(20054) (Show Source):
You can put this solution on YOUR website! How much would i have to invest at 3% interest compounded annually in order to have $16,000.00 at the end of seven years?
We use the formula
A = P(1 + )n·t
in which
A = the final amount of dollars = $16,000.00
P = the biginning amount of dollars = ??
r = the rate expressed as a decimal = 0.03
n = the number of times per year the interest is compounded = 1
t = the number of years = 7
16000 = P(1 + )1·7
16000 = P(1 + 0.03)7
16000 = P(1.03)12
16000 = P(1.425760887)
= P
$11222.08 = P
Edwin
