Chapter5: The Time Value Of Money
Section: Chapter Questions
Problem 1P
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Question
How much will you need to save per month to have $200,000 after 12 years, if you account earns 5% interest per year, compounded monthly?
Expert Solution
Step 1
Compound interest = P"(1+r%/n)^tn
Since the final amount is given , we need to calculate the principal amount
Interest rate =5%
Years = 12
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