Sandy knows that she needs $82,000 for a 15% down payment on a house she can afford. She found an investment that earns 3.25% interest compounding monthly. How much should she put in the account now, rounded to the nearest dollar, to ensure she has the down payment amount in 5 years?
$38,915 ?
Is it C? $69,717
P(1+.0325/12)^5 = 82000
Now just solve for P
I am sure Steve meant to say
P(1+.0325/12)^60 = 82000 , since there are 60 months in 5 years.
So recalculate your answer.
Reiny is correct. My bad.
How ever did you get such a low number?
I put it in a calculator and it came to that, I figured it was it and its also one of an answer choices.
A. 12,034
B.$38,915
C.$69,717
D.$72,374