SOLUTION: find the amount that should be invested now to accumulate $7,100.00 at 6.5% compounded quarterly for 12 years.

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Question 972378: find the amount that should be invested now to accumulate $7,100.00 at 6.5% compounded quarterly for 12 years.
Answer by lwsshak3(11628) About Me  (Show Source):
You can put this solution on YOUR website!
find the amount that should be invested now to accumulate $7,100.00 at 6.5% compounded quarterly for 12 years.
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Compound interest formula: A=P(1+r/n)^nt, P=initial investment, r=interest rate, n=number of compounding periods per year, t=years, A=amt after t-years
For given problem:
P=?
r=.065
n=4
t=12
A=7100
..
7100=P(1+.065/4)^4*12=P(1+.01625)^48=P(1.01625)^48
P=7100/(1.01625)^48
P=3275.15
Amount that should be invested now=$3,275