How much would you have to invest today in an account that pays 5.00% APR, compounded...

Question

Question

Answer 1

Answer #1

Answer is $2,951

Desired Sum = $3,000
Annual Interest Rate = 5.00%
Monthly Interest Rate = 0.4167%
Period = 4 months

Amount Invested = Desired Sum / (1 + Monthly Interest Rate)^Period
Amount Invested = $3,000 / 1.004167^4
Amount Invested = $2,951

Answer 2

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