What amount must be deposited today at 6% p.a. to grow to $15 000 in five years?

Question

Quizplus · Accepted Answer

To find the present value (amount to be deposited today) that will grow to a future value of $15,000 in five years at an annual interest rate of 6%, we use the formula for the present value of a single sum: PV = FV / (1 + r)^n, where PV is the present value, FV is the future value ($15,000), r is the annual interest rate (6% or 0.06), and n is the number of years (5). Plugging in the values, we get PV = $15,000 / (1 + 0.06)^5, which calculates to approximately $11,209.50.

What Amount Must Be Deposited Today at 6% P