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Math 109

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Your cousin has just won the lottery and wants to create an account that will have $100,000 in 16 years to help pay for their child's college tuition. If the account has a fixed interest rate of 4.6% compounded 4 times each year, how much money should they put into the account?

  • Math 109 -

    Interest is compounded 64 times at
    1.0115 times the previous balance.
    X*(1 + 0.046/4)^64 = 100,000
    X*2.0788195= 100,000
    X = $48,104.22

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