A year ago, you deposited $30,000 into a retirement savings account at a fixed rate of 5.5 percent. Today, you could earn a fixed rate of 6.5 percent on a similar type account. However, your rate is fixed and cannot be adjusted. How much less could you have deposited last year if you could have earned a fixed rate of 6.5 percent and still have the same amount as you currently will when you retire 38 years from today?

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Taliyah Mills

4 March, 10:49

A year ago, you deposited $30,000 into a retirement savings account at a fixed rate of 5.5 percent. Today, you could earn a fixed rate of 6.5 percent on a similar type account. However, your rate is fixed and cannot be adjusted. How much less could you have deposited last year if you could have earned a fixed rate of 6.5 percent and still have the same amount as you currently will when you retire 38 years from today?

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Rylie Bradford · Answer 1

How much less could you have deposited last year if you could have earned a fixed rate of 6.5 percent and still have the same amount as you currently will when you retire 38 years from toda

PV=29718,30

Explanation:

Calculte FV with interest 5,5%

F = P (1 + i * n)

FV=30000 (1+5,5%) * 38

FV=1202700

Calculate PV with interest 6,5%

F = P (1 + i * n)

1202700=x (1+6,5%) * 38

PV=29718,30