## MYP Mathematics, Present value

number, algebra, geometry and trigonometry, statistics and probability, discrete mathematics.

### MYP Mathematics, Present value

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 Lucas Posts: 0 Joined: Mon Jan 28, 2013 8:05 pm ### Re: MYP Mathematics, Present value MYP Mathematics, Financial Mathematics, Compound Interest, Present value The general compounding formula is: $F=P \cdot (1+ \frac{r}{100})^n$ Where F is the future value of the investment (=$20000), P the principal, r is the interest rate per compound period $( \frac{4}{12}=\frac{1}{3})$ and n is the number of compounding periods (=6*12=72 months).

Therefore

$20000=P \cdot (1+ \frac{1}{300})^{72}=>P=\15738.84$

Hope these help!!
miranda

Posts: 268
Joined: Mon Jan 28, 2013 8:03 pm

### Re: MYP Mathematics, Present value

thanks miranda!!
Lucas

Posts: 0
Joined: Mon Jan 28, 2013 8:05 pm

### Re: MYP Mathematics, Present value

thanks miranda!!
Lucas

Posts: 0
Joined: Mon Jan 28, 2013 8:05 pm