How much should be deposited in an account paying 6% interest compounded semi-annually in order to have a balance of $13,500 after 3 years?

Question

stormfire1 · Answer

P = principal amount (the initial amount you borrow or deposit)
r  = annual rate of interest (as a decimal)
t  = number of years the amount is deposited or borrowed for.
A = amount of money accumulated after n years, including interest.
n  =  number of times the interest is compounded per year  

$$A = P(1+\frac{r}{n})^{nt}$$

$$$13,500=P(1+\frac{.06}{2})^{2*3}$$Solve for P to get ~$11,306.04

stormfire1 · Answer

Similar to your earlier posts, you just plug in all the know values and solve for the unknown one.