An investment company pays 9% compounded semiannually. You want to have 14,000 in the future. How much should you deposit now to have that amount 5 years from now?

Solution

An investment company pays 9% compounded semiannually. You want to have 14, 000 in the future. How much should you deposit now to have that amount 5 years from now?

Solution

Principal : 9014.99

Solution steps

Translate the problem into an equation:

14000 = P (1 + \frac{0.09}{2})^{2 \cdot 5}

Solve for

P, 14000 = P (1 + \frac{0.09}{2})^{2 \cdot 5} : P = 9014.99

Principal : 9014.99

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An investment company pays 9​% compounded semiannually. You want to have 14,000 in the future. How much should you deposit now to have that amount 5 years from​ now?

Solution

Solution

Popular Examples

An investment company pays 9% compounded semiannually. You want to have 14,000 in the future. How much should you deposit now to have that amount 5 years from now?