Question

1)

April wants $7,000 saved in 4 years to make a down payment on a house. How much money should she invest now at 3.15% compounded semiannually in order to meet her goal?

2)

How much will need to be invested at the beginning of every 2 months at 7.7% compounded every 2 months, to pay off a debt of $24,000.00 in 5 years?

The every 2 months payments are $. (Round to 2 decimal places.)

Answer 1

Question (1)

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future value = A=7000

t=4 years

r=3.15% = 0.0315

n=2 for semiannual compound

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..............should she invest now

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.

.

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Question (2)

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for the future value, we use generally below formula

but here money is  invested at the beginning of every 2 months

so the formula will be

future value = FV=24000

t=5 years

r=7.7% = 0.077

n=6 for compounded every 2 months

The every 2 months payments are $652.54.