Question

How much must you invest at one time in order to accumulate $18,000 in 12 years at 5% annual interest?

Answer 1

Use the geometric sequence formula

Explanation:

We can solve this problem by using the formula `tn=t1*r^(n)`
where tn is general term, t1 is the first term of the sequence, r is the common ratio, and n is the number of terms.

By plugging the values we have into the formula we'll see that:

`18,000 = t1*1.05^(12)`

`18,000 = t1 * 1.80`

`t1 = 10023.1`

The answer is $10,023.1