Question

Suppose you are depositing an amount today in an account that earns 5% interest, compounded annually. If your goal is to have $5000 in the account at the end of six years, how much must you deposit in the account today?

Answer 1

Answer:

If you walk into a bank and open up a savings account you will earn interest ... include the amount of money deposited called the principal, the annual interest rate ...

Answer 2

Answer:

3731.08

Step-by-step explanation:

let x= the present value (or principle)

$5000=x(1.05)^6\\\frac{5000}{1.05^6}=x\\x=3731.076983$