Algebra

Following the birth of a​ child, a parent wants to make an initial investment P 0 that will grow to ​$70,000 for the​ child's education at age 19. Interest is compounded continuously at 6​%.
What should the initial investment​ be? Such an amount is called the present value of ​$70,000 due 19 years from now.

  1. 👍 1
  2. 👎 0
  3. 👁 4,322
  1. x e^.06t = 70000
    x = 70000/e^(.06(19))
    = 22,387.33

    1. 👍 3
    2. 👎 0

Respond to this Question

First Name

Your Response

Similar Questions

  1. Math Problem (please help)

    On the day of a child's birth, a deposit of $30,000 is made in a trust fund that pays 3% interest, compounded continuously. Determine the balance in this account on the child's 30th birthday. (Round your answer to two decimal

  2. Pre-Calc

    An initial investment of $9000 grows at an annual interest rate of 5% compounded continuously. How long will it take to double the investment?

  3. Finance

    An insurance company is offering a new policy to its customers. Typically, the policy is bought by a parent or grandparent for a child at the child's birth. The details of the policy are as follows: The purchaser (say, the parent)

  4. compound interest

    How do I solve these problems? Complete the table for a savings account in which interest is compounded continuously. 1. Initial Investment: $1000 Annual % Rate: 3.5% Time to Double: ? Amount After 10 Years: ? 2. Initial

  1. Physics

    Two children are playing on two trampolines. The first child can bounce 1.6 times higher than the second child. The initial speed up of the second child is 5.2 m/s. (a) Find the maximum height the second child reaches. (b) What is

  2. Children Development

    . In what ways have factors from Microsystems outside the family, from the mesosystem, and the exosystem possibly influenced your child’s development at ages 6, 8 and 10? Find four examples of such influences and make clear why

  3. psychology

    Ryan was purchasing a new garden hose at Wal-Mart when he heard raised voices in the next aisle. When the cart came around the corner, he had to move quickly to dodge an exploring preschool age child followed by an “out of

  4. exponential function

    An investment pays 8% interest, compounded annually. a) write an equation that expresses the amount, A, of the investment as a function of time, t, in years. b) determine how long it will take for this investment to double in

  1. PHYSICS

    a 75kg parent and a 22kg child meet at the center of an ice rink. they place their hands together and push hard enough to slide apart. a. is the force experienced by the child more than, less than, or the same force experienced by

  2. math

    The terms of a single parent's will indicate that a child will receive an ordinary annuity of $20,000 per year from age 18 to age 24 (so the child can attend college) and that the balance of the estate goes to a niece. If the

  3. Children Development

    In what ways have factors from Microsystems outside the family, from the mesosystem, and the exosystem possibly influenced your child’s development at ages 6, 8 and 10? Find four examples of such influences and make clear why

  4. early childhood educastion

    what can a teacher do to reinforce the primary relationship between the parent and child and communicate that the teacher does not desire to take the parent's place in the child's life?

You can view more similar questions or ask a new question.