A man nearing retirement wants to invest some money in a fund that compounds annually at a rate of 6 percent, so that in five years, he will have at least $100,000. How much money must he invest now to make that happen?

atlas9 Dec 11, 2019

#1**0 **

FV=PV(1+i)^{n}

FV=future value = 100 000

PV=present value= amount to invest now

i = interest rate in decimal form = .06

n = # compounding periods = 5 for this question

Plug in the numbers and solve for PV....

ElectricPavlov Dec 12, 2019