Problema Solution

Finance: A couple just had a new child. How much should they invest now at 6.25% compound daily to have $100,000 for the child's education 17 years from now? Compute the answer to the nearest(assume a 365 day year) dollar.

Answer provided by our tutors

100 000 = P(1 + 0.0625/365) ^ (365•17)

100 000 ÷ ((1 + 0.0625/365) ^ (365•17)) = P; do it on your calculator and round as asked