Solve the problem.
-Cindy will require $\$ 14,000$ in 2 years to return to college to get an MBA degree. How much money should she ask her parents for now so that, if she invests it at $11 \%$ compounded continuously, she will have enough for school? (Round your answer to the nearest dollar.)
A) $\$ 11,235$
B) $\$ 11,363$
C) $\$ 17,445$
D) $\$ 9017$

Question

Quizplus · Accepted Answer

The amount of money Cindy needs to invest now is given by the formula:$$P = \frac{A}{e^{rt}}$$where:* P is the present value* A is the future value* r is the annual interest rate* t is the time in yearsIn this case, we have:* A = $14,000* r = 11% = 0.11* t = 2 yearsSubstituting these values into the formula, we get:$$P = \frac{14000}{e^{0.11 * 2}} = 11363.36$$Rounding to the nearest dollar, we get $11,363.Therefore, the correct answer is B.

Solve the Problem $14,000\$ 14,000$14,000 In 2 Years to Return to College to Get an Years

Solve the Problem $\$ 14,000$ In 2 Years to Return to College to Get an Years