Financial Math & annuity

Mathematics
Tutor: None Selected Time limit: 1 Day

What sum deposited today at 5% compounded annually for 8 years will provide the same amount as $1000 deposited at the end of each year for 8 years at 6% compounded annually?

Aug 22nd, 2015

Thank you for the opportunity to help you with your question!

A=P(1+r/n)^nt

P(1+0.05/1)^8=1000(1+0.06/1)^8

P(1.05)=1000(1.06)

P=1060/1.05

P=$ 1009.52

Please let me know if you need any clarification. I'm always happy to answer your questions.
Aug 22nd, 2015

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