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How much money must stemmer invest if he wants to buy a bicycle in cash after 5 years? The bank offers him an interest rate of 8.8% compounded yearly. He needs R6600 at the end of the period to buy the bicycle.

Respuesta :

Answer:

4,329

Step-by-step explanation:

The computation of the amount invested is shown below:

As we know that

Present value = Future value ÷ (1 + interest rate)^years

= 6600 ÷ (1 + 0.088)^5

= 6600 ÷ 1.088^5

= 4,329

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