math teachers..accountants..... smart people...help with homework pls

[Dar]

My son is cramming at the last minute he has math that is due on Monday.... I suck at math (well this stuff anyway)

heres the question.... well there are a couple..

1) Adrian won $10,000 in the lottery. He has decided to spend some of the money and save the rest. Adrian wants the money he saves to grow to his original winnings in 7 years. He can invest the money at 4% per year, compounded monthly. How much money must Adrian invest?

2)Calculate the present value of each investment.

a) $46000 due in 7 years, if the interest is calculated at 5% per year

b) $3600 due in 12 years at 1% per year, compounded semi monthly


I dont remember how to do this stuff... I was able to help with he other stuff but I cant find formulas for these in his text

any help would be great. .. I am a visual learner.... so you cant just explain it in writing.. i need to see the problem solved with steps... thanks

 

[DinosRBirds]

Quote:

what grade is he in???????

 

[Dar]

Quote:

what grade is he in???????

11.. I dont feel silly now...

 

[Matthew3590]

Sounds like algebra 2. I might be some help if I can find my book. We did some of the formulas for compounded continuously and other methods.

I took algebra 2 freshman year. SO it is still iffy on me.

 

[hdowden]

its algebra 2 and i dont remeber how to do these type of problems

 

[BlackBrookPoultry]

I know how to compute that in Excel, but not on paper!

 

[animalsRawesome]

Not 100 percent sure, but here goes:

A= P(1+r/n)^nt
10,000= P (1+.04/12)^12*7
10,000= P(1.00333333)^84
10,000= 1.323P
P=7558.6

Thats what I got. Do you have the answer to know if I did it correctly?

 

[HeatherLynn]

I did something similar. a=p(1+r)n
10,000=(10,000-x)(1+.04)7th power
10,000=(10,000-x)(1.316)
10,000=13160-1.316x
1.316x=3160
x=2401.22
x being the amount he spent and did not invest

10,000-2401.22= 7598.78

I popped this into a compounding interest calculator and came up with investing 7598.78 for 7 years at 4% interest compounded monthly is 10049.49. Close but not perfect. I have tried six ways to Sunday to get exactly 10000 back and I cannot make it happen.

http://www.webmath.com/compinterest.html This was a pretty handy website. gives a worked out explanation of what the calculator did to figure that end figure up.


animals your amount comes to $9996.35. You got much closer than I could. I gotta be doing something off just not sure what yet.

 

[Dar]

book says answer is $7567.38

and this is what confuses the jeebers out of me.. animal comes closest to the $10,000 but Heather comes closest to the book answer....