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Independent Practice 11. Explore2.plan3.solve4.checkHow much must Michelle set aside and invest in a fund earning 2.1%compounded quarterly if she wants to accumulate P 50,000.00 in 5 years?​

Answer»

Given :   a FUND earning 2.1% compounded QUARTERLY

accumulate P 50,000.00 in 5 years

To Find :  How much must Michelle set aside and invest

Solution:

t Michelle set aside and invest =  P  

R = 2.1 % per annum = 2.1/4  =  0.525 % Quarterly  

T = 5 years = 20 Quarters

A = 50,000

A = P( 1  + R/100)ⁿ

=> 50,000  = P ( 1 + 0.525/100)²⁰

=> P = 45,028.59

Michelle set aside and invest = 45,028.59

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