How much money should be invested now (rounded to the nearest cent), called the initial investment, in a Treasury Bond investment that yields 5.75% per year, compounded monthly for 7 years, if you wish it to be worth $12,000 after 7 years?

Hint: A(t) = A0(1 + start fraction r over n end fraction)nt, where A(t) is the final amount, A0 is the initial investment, r is the growth rate expressed as a decimal, n is the number of compounding periods per year, and t is time in years.

$8,113.69
$8,505.65
$13,458.78
$8,031.47

Question

How much money should be invested now (rounded to the nearest cent), called the initial investment, in a Treasury Bond investment that yields 5.75% per year, compounded monthly for 7 years, if you wish it to be worth $12,000 after 7 years?

Hint: A(t) = A0(1 + start fraction r over n end fraction)nt, where A(t) is the final amount, A0 is the initial investment, r is the growth rate expressed as a decimal, n is the number of compounding periods per year, and t is time in years.

 $8,113.69
 $8,505.65
 $13,458.78
 $8,031.47