Question

If you wish to accumulate USD 1, 40,000 in 10 years, how much must you deposit today in an account that pays an annual simple discount rate of 8%?​

Answer 1

let the money invested=x

rate of interest=8%

time=10 years

I=140,000

wkt,

I=PTR/100

I=x*8*10/100

140000=x*8/10

x=140000*10/8

x=1400000/8

x=175000$

amount to be invested=175000-140000=35000

Ans= to accumulate 140,000$ in 10 years at an interest rate of 8% we must invest 35,000$