Mckenzie wants 10,000 saved in 6 years to make a down payment on a house. How much money should she invest now at 2.4% compounded monthly in order to meet her goal

Solution

Mckenzie wants 10, 000 saved in 6 years to make a down payment on a house. How much money should she invest now at 2.4% compounded monthly in order to meet her goal

Solution

Principal : 8660.12

Solution steps

Translate the problem into an equation:

10000 = P (1 + \frac{0.024}{12})^{12 \cdot 6}

Solve for

P, 10000 = P (1 + \frac{0.024}{12})^{12 \cdot 6} : P = 8660.12

Principal : 8660.12

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