Answer:
$18 034.42
Step-by-step explanation:
The formula for the future value of an account paying 5 % annual interest compounded quarterly for four years is
[tex]A = P(1 +\frac{r }{n })^{nt}[/tex]
A = $22 000
r = 0.05
n = 4 times per year
t = 4 years
[tex]22 000 = P(1 +\frac{0.05 }{4 })^{4\times4}[/tex]
[tex]22 000 = P(1 + 0.0125)^{16}[/tex]
[tex]22 000 = P(1.0125)^{16}[/tex]
22 000 = P x 1.220
P = 2 000/1.220
P = $18 034.42
You must invest $18 034.42.
