Question

help ? *Advance Algebra With Financial Applications *

Miguel needs $34,100 to purchase a boat. How much money will he need to invest today in a savings account earning 4.1% interest, compounding quarterly, to have enough money to purchase the boat in 16 years?

$2,605.60

$17,754.46

$28,948.17

$31,935.91

Answer 1

I used this formula FV = P((1+r/n)^(n*t) - 1 )/( r/n ) but it's not giving me the right answer.

Answer 2

that looks like the savings plan formula (the one you use when making monthly payments). I think you just need the compound interest formula

Answer 3

Do u have considered time ? Here it is quarterly . Morecoer you shoud use compound intrest formula

Answer 4

\[A = P\left(1+\frac{r}{n}\right)^{nt}\]

Answer 5

\[B_n=B_ok^{4*t}-P\frac{1-k^{4*t}}{1-k}\]
\[B_{16}=B_ok^{4*16}-0\frac{1-k^{4*16}}{1-k}\]
\[34100=B_ok^{4*16}\]
\[\frac{34100}{k^{4*16}}=B_o~:~k=1+.041/4\]

Answer 6

http://www.wolframalpha.com/input/?i=34100%2Fk%5E%284*16%29%2C+k%3D1%2B.041%2F4

Answer 7

@cruffo http://www.wolframalpha.com/input/?i=A%3D34100(1%2B(0.041)%2F(4))%5E(4*16)&t=crmtb01 o.O

Answer 8

Ah... $34,100 is the desired future value

Answer 9

\[\large 34,100 = P\left(1+\frac{0.041}{4}\right)^{(4\cdot 16)}\]

You need to solve for P because you need to find out how much he should invest right now to get $34,100 in 16 years.

Answer 10

I tend to use B for balances, and P for Payments ... as opposed to A for Amount and P for Principal :)

Answer 11

that would be wise, but most texts use A and P for the compound interest formula, or possible A = FV and P = PV

Answer 12

http://www.wolframalpha.com/input/?i=solve+34100%3Dx%281%2B%280.041%29%2F%284%29%29%5E%284*16%29

Answer 13

Note that that answer is rounded to the nearest 10 cents!

Answer 14

I got $17, 754.46 rounding to the nearest cent.

Answer 15

Me too

Answer 16

Ya!