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stephyaz
Feb 18, 2009, 05:19 PM
A company estimates that it will need $150,000 in 10 years to expand. A bank agrees to pay the company 5% interest compounded annually if the company deposits the entire amount now needed to accumulate $150,000 in 10 years. How much money does the company need to deposit?


Answer The company will need to deposit $92,087 to have $150,000 in 10 years.


Caulations Total = Principal × ( 1 + Rate )years
How do I show my work for this?
pready
Feb 18, 2009, 07:42 PM
Use the Present value of $1 table
PV=$150,000 X Interest Factor (5% @<hidden> periods)