0
How much money needs to be invested now to get 2000 after 4 years at 8 percent compounded quarterly?
Wiki User
∙ 14y ago
Each quarter, you are going to make Interest rate/number of periods per year on your investment. Since you have an interest rate of 8% and four periods per year, each quarter you make 2% on your principal.
Thus, the formula for determining the value of your investment after ONE quarter is Principal * 102% or P*1.02.
Each time you accrue interest, your investment grows by a further 2%, so the formula for the value of your investment over x quarters is P*(1.02^x) (the carrot "^" is a common computer symbol denoting an exponent).
Since you are interested in 8 years and you have 4 quarters per year, you will have 32 compounding periods and a final formula of P*(1.02^32).
Since you don't know P, but do know the final value of $2000, you must solve the following equation for P.
P*(1.02^32)=2000
To do this, simply divide both sides by 1.02^32. This gives you the value of your initial principal:
P = 2000/(1.02^32)
Wiki User
∙ 14y ago
Add your answer:
Earn +20 pts
How much money should be invested at 14 percent compounded quarterly to yield 12000 at the end of 7 years?
4795.65 (approx).
How much money has to be invested at 5.1 percent interest compounded continuously to have 17000 after 14 years?
Type your answer here... $8,324.59
How much money invested at 10 percent compounded continuously for 3 years will yield 630?
630/(1.1)3 = 630/1.331 = 473.33
If Mary deposits 275 in principal at an interest rate of 3.2 percent how much interest will she earn in one year?
Before she chooses a bank and deposits her money, Mary should shop around first.There are different kinds of interest.At 3.2% . . .If it's simple interest, her money will earn $ 8.80 .If it's compounded quarterly, it earns $ 8.91 in one year.If it's compounded monthly, it earns $ 8.93 .If it's compounded daily, it earns $ 8.94 .Also, by the way, notice that Mary doesn't earn the interest. Her invested money does.
How long does it take 1125 to triple if it is invested at 7 percent interest compounded quarterly?
(1 + .07/4)4x = 3 4x log(1+.07/4) = log(3) x = 0.25 log(3)/log(1.0175) = 15.83 The amount of the original investment doesn't matter. At 7% compounded quarterly, the value passes triple the original amount with the interest payment at the end of the 16th year.
How much money should be invested at 14 percent compounded quarterly to yield 12000 at the end of 7 years?
4795.65 (approx).
If you have 2500 to invest at 6 interest compounded quarterly. For how many years will the money need to be invested for that amount to triple?
It will take 19 years.
How much money has to be invested at 5.1 percent interest compounded continuously to have 17000 after 14 years?
Type your answer here... $8,324.59
How much money has to be invested at 4.3 percent interest compounded continuously to have 19000 dollars after 16 years?
You would need 9687 dollars.
How much money invested at 10 percent compounded continuously for 3 years will yield 630?
630/(1.1)3 = 630/1.331 = 473.33
If a Principal of 12000 is invested in an account paying an annual interest rate of 10 percent what is the amount in the account after 6 years if the account is compounded quarterly?
Quarterly compounding means 1/4 of the annual interest rate is paid 4 times a year.In 6 years, you get 2.5 percent 24 times.(1.025)24 = 1.80873 (rounded)Your $12,000 has then grown to (12,000 x 1.80873) = $21,704.71 .Can I send you some money to add to the account for me ?
If Mary deposits 275 in principal at an interest rate of 3.2 percent how much interest will she earn in one year?
Before she chooses a bank and deposits her money, Mary should shop around first.There are different kinds of interest.At 3.2% . . .If it's simple interest, her money will earn $ 8.80 .If it's compounded quarterly, it earns $ 8.91 in one year.If it's compounded monthly, it earns $ 8.93 .If it's compounded daily, it earns $ 8.94 .Also, by the way, notice that Mary doesn't earn the interest. Her invested money does.
How long does it take 1125 to triple if it is invested at 7 percent interest compounded quarterly?
(1 + .07/4)4x = 3 4x log(1+.07/4) = log(3) x = 0.25 log(3)/log(1.0175) = 15.83 The amount of the original investment doesn't matter. At 7% compounded quarterly, the value passes triple the original amount with the interest payment at the end of the 16th year.
How long will it take for an amount of money invested at an annual rate of 5.75 percent compounded continuously to triple in value?
y = ln(3)/ln(1.0575) = 19.65 years, approx.
A sum of money invested at 4 percent interest compounded semiannually will double in amount in aprproximately how many years?
I haven't gotten the answer to that test question either....the choices seem wrong
How much money invested at 5 percent compounded continuously for 3 years will yield 820?
708.35 will yield 820.004 = 820.00 The annual growth rate is eln(1.05) - 1 or 10log(1.05) - 1
Does money earn more compounded annually or quarterly?
It would earn more if interest were compounded quarterly but any lender will adjust the quarterly rate so that you get the same! For example, a 5% annual rate is equivalent to a rate of 4.9089% per quarter. This is one reason that some countries require the publication of Annual Equivalent Rates to enable investors to compare such differences.
