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MYP Mathematics, Present value

PostPosted: Sun Mar 10, 2013 8:58 am
by Lucas
MYP Maths, Financial Mathematics, Compound Interest, Present value

How can we calculate the amount to be deposit into an account to collect $20000 at the end of 6 years if the account is paying 4% per annum compounded every month?
Thanks

Re: MYP Mathematics, Present value

PostPosted: Sun Mar 10, 2013 9:21 am
by miranda
MYP Mathematics, Financial Mathematics, Compound Interest, Present value

The general compounding formula is:


Where F is the future value of the investment (=$20000), P the principal, r is the interest rate per compound period and n is the number of compounding periods (=6*12=72 months).

Therefore




Hope these help!! :lol:

Re: MYP Mathematics, Present value

PostPosted: Sat Apr 06, 2013 7:56 pm
by Lucas
thanks miranda!!

Re: MYP Mathematics, Present value

PostPosted: Sat Apr 06, 2013 7:57 pm
by Lucas
thanks miranda!!