Answer to Question #256197 in Financial Math for whatevr

Question

Parents wish to have $160,000 available for a​ child's education. if the child is now 5 years​ old, how much money must be set aside at 3% compounded semiannually to meet their financial goal when the child is​ 18?

Answer 1

Number of half years between the ages 5th and 18th = 26

$P(1+ \frac{3}{100})^{26} = 160000 \\ P(1.03)^{26} = 160000 \\ P = \frac{160000}{1.03^{26}} \\ P = 74191.15$