Question

$\huge\mathcal{Question}$

Betsy Parker wants to buy a house in next 10 years and decides to have a SMART goal of having $40,000 as down payment. With the investment that gives interest rate of 5%, how much money she needs to set aside now?

➡ɴᴇᴇᴅ ǫᴜᴀʟɪᴛʏ.
➡ғᴜʟʟ ᴇxᴘʟᴀɴᴀᴛɪᴏɴ.
➡ɴᴏ sᴘᴀᴍ/ᴄᴏᴘʏ.
​

Answer 1

Answer:

P=40,000

T=10 years

R=5%

For the 1st year

si=p*r*t/100

=40000*10*1/100

Rs.4000

Amount =40000+4000=44000

For the 2nd year

P=44000

T=1year

R=10%