How much money should be deposited today in an account that earns 9.5% compounded monthly so that it will accumulate to $10,000 in three years? (Do not round until the final answer. Then round to the nearest cent.)

Question

anonymous · Answer

Alright i'll explain this one...

anonymous · Answer

im not a retard i swear finals are just making me brain dead haha

anonymous · Answer

haha no no i know exactly how you feel. im right in the middle of finals too

anonymous · Answer

FV=PV*(1+r/n)^(nt)
where r is the rate, n is the compounding periods per year and t is the time in years.

So here we're gonna plug the known values in and solve for the unknown value of PV:
$10,000=PV*(1+(.095/12))^(12*3)
$10,000=PV*(1.00792))^(12*3)
$10,000=PV*1.32827
PV=10,000/1.32827=$7,528.59

anonymous · Answer

yesssssss i got the right answer

anonymous · Answer

haha nice