How much should Sabrina invest now in a money market account if she wishes to have $9000 in the account at the end of 10 years? The account provides an APR of 6% compounded quarterly. The formula for compound interest is A = P(1 + r/n)^nt.

Question

ganeshie8 · Answer

plugin the numbers in the given formula.

A = 9000,
r = .06
n = quaterly compounding = 4 times a year
t = 10 years

$\huge 9000 = P(1+\frac{.06}{4})^{(4*10)}$

ganeshie8 · Answer

@kenneyfamily  can you solve for P ?

anonymous · Answer

do you divide 9000 by 1.814?

ganeshie8 · Answer

yep! http://www.google.co.in/webhp?sourceid=chrome-instant&ie=UTF-8#hl=en&sclient=psy-ab&q=(1%2B.06%2F4)%5E(40)&oq=(1%2B.06%2F4)%5E(40)&gs_l=hp.3...9761.24587.0.24902.2.2.0.0.0.0.170.170.0j1.1.0...0.0.8_JzXG_RiJA&pbx=1&bav=on.2,or.r_gc.r_pw.r_qf.,cf.osb&fp=d70cb7a1447ca32b&biw=1822&bih=1019

anonymous · Answer

THANK YOU!!!! so helpful

ganeshie8 · Answer

yw !! glad to hear :))