Question

How much would Carol have to invest today at 6.2% compounded annually to have $4600 for a vacation to China in two years?

Answer 1

$\bf \qquad \textit{Compound Interest Earned Amount} \\\\ A=P\left(1+\frac{r}{n}\right)^{nt} \quad \begin{cases} A=\textit{accumulated amount}\to &\ 4600\\ P=\textit{original amount deposited}\\ r=rate\to 6.2\%\to \frac{6.2}{100}\to &0.062\\ n= \begin{array}{llll} \textit{times it compounds per year}\\ \textit{annually, so once} \end{array}\to &1\\ t=years\to &2 \end{cases} \\\\\\ 4600=P\left(1+\frac{0.062}{1}\right)^{1\cdot 2}$

solve for P