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6 July, 19:43

how much money must be deposited now in an account paying 7% annual interest compounded yearly to have a balance of $1000 after 6 years

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  1. 6 July, 23:14
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    Answer: P = $70.42

    Step-by-step explanation:

    Equation:

    P = A / (1 + rt)

    Calculation:

    First, converting R percent to r a decimal

    r = R/100 = 7%/100 = 0.07 per year.

    Solving our equation:

    P = 100 / (1 + (0.07 * 6)) = 70.422535211268

    P = $70.42

    The principal investment required to get a total amount, principal plus interest, of $100.00 from simple interest at a rate of 7% per year for 6 years is $70.42.
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