How much money should I invest at an annually compounded interest rate of 5% so that I have $500,000 in ten years?

Guest Dec 5, 2019

#1**0 **

FV = PV (1+.05)^{n}

FV = Future Value = 500 000 PV = Present Value = amount to invest now .05 = interest rate n = number of years=10

Can you take it from here? (this assumes a one time investment now)

ElectricPavlov Dec 5, 2019

#1**0 **

Best Answer

FV = PV (1+.05)^{n}

FV = Future Value = 500 000 PV = Present Value = amount to invest now .05 = interest rate n = number of years=10

Can you take it from here? (this assumes a one time investment now)

ElectricPavlov Dec 5, 2019

#2**0 **

i don't think i got it from there :( here's what i thought:

now that i know all the variables(thanks to you!) i have:

500,000=(1.05)10p

500,000=10.5p

but then dividing both sides by 10.5 gives me a really funky number (47619.0476) so i don't think it's right.. what did i do wrong??

Guest Dec 5, 2019

#3**0 **

Sorry...I mislead you just a bit....the 'n' should be a supescript....I fixed it above....do you see it should be (1.05)^{n }

ElectricPavlov
Dec 5, 2019