How much must be invested today at 6% compounded quarterly to have $8,000 in 5 years? Round your answer to the nearest cent
How much must be invested today at 6% compounded quarterly to have $8,000 in 5 years? Round your answer to the nearest cent
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
How much must be invested today at 6% compounded quarterly to have $8,000 in 5 years? Round your answer to the nearest cent
Expert Solution
Step 1
For the above calculation, we need to use the following formula
A = P ( 1 + r / n )^nt
Where
A = Future value
P = Present value
r = Rate
n = number of time interest applied
t = number of time period
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