Evan is going to invest in an account paying an interest rate of 4.4% compounded monthly. How much would Evan need to invest, to the nearest dollar, for the value of the account to reach 41,000 in 8 years?

Solution

Evan is going to invest in an account paying an interest rate of 4.4% compounded monthly. How much would Evan need to invest, to the nearest dollar, for the value of the account to reach 41, 000 in 8 years?

Solution

Principal : 28853.05

Solution steps

Translate the problem into an equation:

41000 = P (1 + \frac{0.044}{12})^{12 \cdot 8}

Solve for

P, 41000 = P (1 + \frac{0.044}{12})^{12 \cdot 8} : P = 28853.05

Principal : 28853.05

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