Chapter 12: Q 4. (page 808)

How much do you need to invest now at $5 %$ per annum compounded monthly so that in 1 year you will have $$ 10000$ ?

Short Answer

Expert verified

We need to invest $$ 9513$ to get $$ 10, 000$ at the end of 1 year.

Step by step solution

Step 1. Write the given information.

To invest now at 5% per annum

compounded monthly so that in 1 year you will have $10,000.

The formula of principle $p = \frac{A}{{(1 + \frac{r}{n})}^{n t}}$

Step 2. Find the principle.

$p = \frac{10000}{{(1 + \frac{0.05}{12})}^{12 \cdot 1}} = \frac{10000}{{(\frac{12.05}{12})}^{12}} = \frac{10000}{1.05116189788} = 9513.2824$

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How much do you need to invest now at $5 %$ per annum compounded monthly so that in 1 year you will have $$ 10000$ ?

Short Answer

Step by step solution

Step 1. Write the given information.

Step 2. Find the principle.

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How much do you need to invest now at 5%per annum compounded monthly so that in 1 year you will have $10000?

Short Answer

Step by step solution

Step 1. Write the given information.

Step 2. Find the principle.

One App. One Place for Learning.

Most popular questions from this chapter

Recommended explanations on Math Textbooks

Applied Mathematics

Pure Maths

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Mechanics Maths

Statistics

Geometry

Study anywhere. Anytime. Across all devices.

How much do you need to invest now at $5 %$ per annum compounded monthly so that in 1 year you will have $$ 10000$ ?