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22 November, 04:20

You need to have $15,000 in five years to pay off a home equity loan. You can invest in an account that pays 5.75 percent compounded quarterly. How much will you have to invest today to attain your target in five years?

(Round to the nearest dollar.)

A) $4,903

B) $11,275

C) $14,184

D) $12,250

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Answers (1)
  1. 22 November, 06:12
    0
    15000 / (1.014375^20) = 11275

    15000/1.33036479387 = 11275

    [5.75/4 = 1.4375%, because the given rate is on quarterly basis. Also, we multiply 5 by 4=20]
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