How much would need to be deposited into an account earning 4.7%, compounded quarterly, so that the balance will be $1,000,000.00 in 20 years?
1 Answer
Jun 16, 2018
You would need to deposit $392,774.20
Explanation:
Compound interest formula:
A = Final amount
P = Initial deposit
r = Interest rate
n = Compound period (times per year)
t = Number of years
1 - Substitute known values
2 - Simplify as needed
3 - Rearrange to find P
4 - Check your answer
edit: fixed bullet points