# Math: Present Value

posted by .

How much money should be invested now at 7% to obtain \$9,000 in 5 years if interest is compounded:

a) Quarterly
b) Continuously

------------

My work:

a)
B = 9000(1 + (0.07/4)^20
B = 12 733

b)
B(5) = 9000e^0.07
B(5) = 0652.57

------------

a) \$6 361.42
b) \$6 342.19

• Math: Present Value -

Quarterly:
For an initial balance B, you want B*(1+.07/4)^20 = 9000.
(1+.07/4)^20 = 1.0175^20 = 1.414778
And 9000./1.414778 = 6361.42 QED

Continuously, you want B*e^(.07*5) = 9000.
e^(.35) = 1.4190675 -- take it from here.

• Math: Present Value -

what is the present value of nine annual cash payments of 4 000 to be paid at the end of each year using an interest rate of 6%.

## Similar Questions

1. ### math

Find the amount that schould be invested now to accumulate following amounts,if te money is compounded as indicated. \$2000 at 9% compund semiannually for 8 years. i don't know how u do this you take 2000(1+.09/12)^96 and you'll get …
2. ### math, algebrai II

Can someone please explain how they got the answer for this problem its in my book: Directions: Find the amount that should be invested now to accumulate the following amounts, if the money is coupounded as indicated. \$7500 at 12% …
3. ### interest

an inheritance will be 20000. the interest rate for the the time value of money is 7%. How much is the inheritance worth now, if it will be received a) in 5 years?

can you help to correct my answer and english grammar. thank you so much. question below: 1. How does money is importance in our society right now?
5. ### algebra

A man invested half of his money at 5%, one-third of his money at 4%, and the rest of his money at 5.5%. If his total investment income was \$570, how much had he invested?
6. ### algebra

A man invested half of his money at 5%, one-third of his money at 4%, and the rest of his money at 5.5%. If his total investment income was \$570, how much had he invested?