Solve the problem.
-Cindy will require $18,000 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)$14,445
B)$14,609
C)$22,429
D)$11,593

Question

Quizplus · Accepted Answer

To find the present value needed, use the formula for continuous compounding: $ P = \frac{F}{e^{rt}} $, where $ F = 18000 $, $ r = 0.11 $, and $ t = 2 $. Calculating gives $ P \approx 14445 $.

Solve the Problem. -Cindy Will Require $18,000 in 2 Years to Return to to Return