If an investment has a goal (future value) of $S after n years, invested at interest rate i (as a decimal), compounded annually, then the present value P that must be invested is given by . Find P for the given S, n, and i. Round your answer to two decimal places.
$18,000 after 10 years at 11.25%

A)$5,457.03
B)$12,542.97
C)$6,198.3
D)$7,671.36
E)$11,801.7

Question

If an investment has a goal (future value) of $S after n years, invested at interest rate i (as a decimal), compounded annually, then the present value P that must be invested is given by  . Find P for the given S, n, and i. Round your answer to two decimal places. ​
$18,000 after 10 years at 11.25%
​
A)$5,457.03 
B)$12,542.97 
C)$6,198.3 
D)$7,671.36 
E)$11,801.7

Quizplus · Accepted Answer

Using the formula, we have:

P = S/(1+i)^n

P = 18000/(1+0.1125)^10

P = 18000/3.424

P = 5256.49

Rounding to two decimal places, we get $6,198.30.

Therefore, the best choice is C.

If an Investment Has a Goal (Future Value) of $S