## Thinking Mathematically (6th Edition)

Published by Pearson

# Chapter 8 - Personal Finance - 8.4 Compound Interest - Exercise Set 8.4 - Page 521: 18

The amount of money that should be deposited today is $9112.94 #### Work Step by Step This is the formula we use when we make calculations with compound interest.$A = P~(1+\frac{r}{n})^{nt}A$is the final amount in the account$P$is the principal (the amount of money invested)$r$is the interest rate$n$is the number of times per year the interest is compounded$t$is the number of years$A = P~(1+\frac{r}{n})^{nt}P = \frac{A}{(1+\frac{r}{n})^{nt}}P = \frac{\$12,000}{(1+\frac{0.07}{2})^{(2)(4)}}$ $P = \$9112.94$The amount of money that should be deposited today is$9112.94

After you claim an answer you’ll have 24 hours to send in a draft. An editor will review the submission and either publish your submission or provide feedback.