SOLUTION: Use the present value formula to determine the amount to be invested now, or the present value when needed. The desired accumulated amount is $4200 after 9 years invested in an acc

Algebra ->  Finance -> SOLUTION: Use the present value formula to determine the amount to be invested now, or the present value when needed. The desired accumulated amount is $4200 after 9 years invested in an acc      Log On


   

Question 1033291: Use the present value formula to determine the amount to be invested now, or the present value when needed. The desired accumulated amount is $4200 after 9 years invested in an account with 4% interest compounded quarterly.
Answer by robertb(5830) About Me  (Show Source):
You can put this solution on YOUR website!
A+=+P%281%2Br%2Fn%29%5E%28nt%29, where A = $4200, r = 0.04, n = 4 (quarterly), and t = 9.
==> 4200+=+P%281%2B0.04%2F4%29%5E%284%2A9%29 <==> 4200=P*1.430768784
==> P = $2,935.48, the value that has to be invested now.