Jamar is going to invest in an account paying an interest rate of 4.7% compounded quarterly. How much would Jamar need to invest, to the nearest ten dollars, for the value of the account to reach 18,000 in 7 years?

Solution

Jamar is going to invest in an account paying an interest rate of 4.7% compounded quarterly. How much would Jamar need to invest, to the nearest ten dollars, for the value of the account to reach 18, 000 in 7 years?

Solution

Principal : 12978.44

Solution steps

Translate the problem into an equation:

18000 = P (1 + \frac{0.047}{4})^{4 \cdot 7}

Solve for

P, 18000 = P (1 + \frac{0.047}{4})^{4 \cdot 7} : P = 12978.44

Principal : 12978.44

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