algebra
posted by Patrice on .
You want to refurnish your home in 3 years. The interior decorator informs you that this will cost $25,000. What should be your payment into an account that gives 6% compounded quarterly?

25000(1+.06)^4*3
I think that is how you would set it up.
You may want to wait for a math tutor to verify. 
the quarterly rate will be .06/4 = .015
let the payment you make now be $x
so
x(1.015)^12 = 25000
x = 25000/(1.015^12
= 20909.69
or you could use the formula
PV = Amt(1+i)^n
present value = 25000(1.015)^12
= 20909.69