Question

How much is to be invested now at 10% compound interest p.a. if after 5 years the investment is to reach a target sum of $30000

Answer 1

Using the Compound Interest formula ;

$A=P(1+\frac {r} {100}) ^n$

$30,000=P(1 +0.1)^5$

$30000=(1.1)^5 P$

$1.6105P=30,000$

$P=\$18,627.76$