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28 March, 09:05

Jessica plans to purchase a car in one year at a cost of $30,000. how much should be invested in an account paying 10% compounded semiannually to have the funds needed?

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  1. 28 March, 10:06
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    The formula is

    A=p (1+r/k) ^kt

    A fund needed 30000

    p Amount invested?

    R interest rate 0.1

    K compounded semiannual 2

    T time 1 year

    Solve the formula for p to get

    P=A: (1+r/k) ^kt

    P=30,000: (1+0.1:2) ^ (2*1)

    P=27,210.88
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