SOLUTION: An alumnus wants to set up a trust (which earns 9% interest compounded semiannually) to provide a grant to his alma mater of $10,000 every six months, beginning six months from now
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Question 253490: An alumnus wants to set up a trust (which earns 9% interest compounded semiannually) to provide a grant to his alma mater of $10,000 every six months, beginning six months from now, for six years. How much should be deposited in the trust? Answer by richwmiller(17219) (Show Source):
You can put this solution on YOUR website! A = P(1+[i/q])^nq
A = Pe^(in)
P = Ae^(-in)
i = log(A/P)/(n log[e]),
n = log(A/P)/(i log[e]).
Here e = 2.718281828459 is the base of natural logarithms.
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