Ask Question
BusinessBusiness
11 October, 09:29

Elizabeth Brown wants to accumulate $8,000 by the end of 12 years. If the annual interest rate is 7.30 percent and interest compounded semi annually, how much will she have to invest today to achieve her goal?

+4
Answers (1)
  1. 11 October, 11:26
    0
    She will invest approximately $3,383.97

    Explanation:

    Formula for compound interest:

    A = P (1 + r/n) ^nt

    Where: A = Final amount

    P = Principal amount

    r = Interest rate

    n = Number of compounding periods per year

    t = Time period in years.

    A = $8,000

    P = Unknown

    r = 7.30 percent = 7.3% = 0.073

    n = semi annually = 2

    t = 12 years

    8,000 = P (1 + 0.073/2) ^2 (12)

    8,000 = P (1 + 0.0365) ^24

    8,000 = P (1.0365) ^24

    8,000 = 2.364086453P

    Divide both sides by the coefficient of P

    8,000/2.364086453 = 2.364086453P/2.364086453

    3,383.971001 = P

    P ≈ $3,383.97

    That is Elizabeth Brown will invest approximately $3,383.97 to achieve her goal
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “Elizabeth Brown wants to accumulate $8,000 by the end of 12 years. If the annual interest rate is 7.30 percent and interest compounded semi ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers
You Might be Interested in
Why are we forced to make choices in day-to-day life? we are forced to make choices in day-to-day life because of resources.
Answers (1)
There appears to be more violence in the workplace than ever before. Even some of the equipment has been sabotaged. The imposing style of management could contribute to this situation. True/False
Answers (1)
The federal government has passed various laws addressing mergers. What did the Clayton ActClayton Act do? The Clayton ActClayton Act a.
Answers (1)
You are a student at ABC University. You recently read in the school's daily newspaper about a terrific investment opportunity that promises to repay you a 44 percent annual return on your investment.
Answers (1)
Your professor receives a promotion when she publishes a journal article within her body of expertise, instead of the promotion going to the department chair's brother-in-law who used to be a cashier but could really use the money.
Answers (1)
New Questions in Business
Match the business with the appropriate cost system (s) for that business using the number of the cost system where 1 = job order costing, 2 = process costing, and 3 = activity-based costing. a. Ketcher, Tryer, and Friar, attorneys-at-law b.
Answers (1)
Solemon Company has total fixed cost of $15,000, variable cost per unit of $6, and a price of $8. If Solemon wants to earn a targeted profit of $3,600, how many units must be sold?
Answers (1)
Using the following information, what is the amount of net income? Purchases $ 33,189 Selling expenses $ 758 Merchandise inventory, September 1 7,436 Merchandise inventory, September 30 8,978 Administrative expenses 760 Sales 51,684 Rent revenue 832
Answers (1)
You are managing a project and need to cut the cost of the project. You decide to transfer workers to another job to cut the project's costs. Costs associated with transferring the workers are an example of project indirect costs. O True O False
Answers (1)
K Inc. has provided the following data for the month of May: Inventories: Beginning Ending Work in process $ 17,000 $ 12,000 Finished goods $ 46,000 $ 50,000 Additional information: Direct materials $ 57,000 Direct labor cost $ 87,000 Manufacturing
Answers (1)
Home » Business » Elizabeth Brown wants to accumulate $8,000 by the end of 12 years. If the annual interest rate is 7.30 percent and interest compounded semi annually, how much will she have to invest today to achieve her goal?
Sign Up Forgot Password?