Problema Solution
if gwen can afford to save only an additional 4,000 a year at 4 percent for five years will she have the 100,000 she needs to start her won business in five years
Answer provided by our tutors
P = $4,000 is the principal
r = 0.04 or 4% the rate
t = 5 years the time
A = the future value
Assuming that the compounding is done annually we have:
A = P(1 + r)^t
A = 4000(1 + 0.04)^5
A = $4866.61
Since 4866.61 < 100,000 follows she will not have $100,000 to start her own business in 5 years.