Brian wants to have $7000 in the bank in 10 years. He deposits $3000 today at 8% interest compounded semiannually. How much additional money will he need to reach the desired $7000

Question

campbell_st · Answer

well you need to find the principal using the compound interest formula 

$$A = P \times(1 + \frac{r}{100})^n$$

so in your question, you know A = 7000 and r = 8 and the number of time periods n = 20  (semi annually means twice per year)

so your formula is 

$$7000 = P \times (1 + \frac{8}{100})^{20}$$

now you need to solve for P

campbell_st · Answer

hope it helps

amistre64 · Answer

is he going to make payments?  or just needing to get more money to deposit all at once?