How much money should be invested now (rounded to the nearest cent), called the initial investment, in a Corporate Bond investment that yields 8% per year, compounded monthly for 10 years, if you wish it to be worth $30,000 after 10 years?

Hint: cap a left parenthesis t right parenthesis equals cap a sub o left parenthesis one plus start fraction r over 12 end fraction right parenthesis to the power of 12 t end power comma where A(t) is the final amount, A0 is the initial investment, r is the growth rate expressed as a decimal amount, and t is time in years.

Question

How much money should be invested now (rounded to the nearest cent), called the initial investment, in a Corporate Bond investment that yields 8% per year, compounded monthly for 10 years, if you wish it to be worth $30,000 after 10 years?

Hint: cap a left parenthesis t right parenthesis equals cap a sub o left parenthesis one plus start fraction r over 12 end fraction right parenthesis to the power of 12 t end power comma where A(t) is the final amount, A0 is the initial investment, r is the growth rate expressed as a decimal amount, and t is time in years.

angiepangie0726 · Answer

@Kinged Think you can help with this one? :)

kinged · Answer

Just use the initial investment as x and use it in yield formula then solve for x since you know the yield...