Answer:
$8206.37
Step-by-step explanation:
According to the Question,
Given, Some money should be deposited in an account today that earns 4% interest Annually. but it is compounded monthly so (4/12)% Will be the new interest Rate .
Now, What Money Should be Invested For 5 years(60 months) to get $10000 in Return .
The Formula for Compound interest is [tex]A=P(1+\frac{r}{n})^{nt}[/tex] .
We have, r=4% , n=12 , t=5 & A=$10000 Put These all value in above equation.
[tex]10000=P(1+\frac{0.04}{12})^{60}[/tex]
[tex]P= \frac{10000}{1.0033^{60} }[/tex] ⇔ $8206.37 Should be invested .
