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Adriel is going to invest in an account paying an interest rate of 2.4% compounded monthly. How much would Adriel need to invest, to the nearest ten dollars, for the value of the account to reach 120,000 in 8 years?

Solution

Adriel is going to invest in an account paying an interest rate of 2.4% compounded monthly. How much would Adriel need to invest, to the nearest ten dollars, for the value of the account to reach 120, 000 in 8 years?

Solution

Principal : 99055.82

Solution steps

Translate the problem into an equation:

120000 = P (1 + \frac{0.024}{12})^{12 \cdot 8}

Solve for

P, 120000 = P (1 + \frac{0.024}{12})^{12 \cdot 8} : P = 99055.82

Principal : 99055.82

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