Question 966931: How much must be invested today in a savings account to realize P32,000 in 6 years if money earns at the rate of 8 1/2% compounded quarterly?
Answer by Theo(13342)   (Show Source):
You can put this solution on YOUR website! money earns at the rate of 8.5% for 6 years compounded quarterly.
the quarterly interest rate is 8.5 / 4 = 2.125% / 100 = .02125.
the numb3er of quarters is equal to 6 * 4 = 24.
the formula is f = p * (1+i)^n
in this problem, p is equal to 32,000.
i is equal to .02125
n is equal to 24.
you get f = 32,000 * (1.02125)^24 = 53,005.34277.
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