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. $24,000 after 10 years at 7.75%

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.  $24,000 after 10 years at 7.75%

Quizplus · Accepted Answer

We can use the formula P = S/(1+i)^n to find the present value P. Plugging in the values given, we get:

P = 24000/(1+0.0775)^10
P = 24000/1.967128382
P = 12177.28

Rounding to two decimal places, we get $11,377.28, which matches choice C. Therefore, the best choice is C.

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