Answer:
[tex]\$9,057.81[/tex]
Step-by-step explanation:
we know that
The compound interest formula is equal to
[tex]A=P(1+\frac{r}{n})^{nt}[/tex]
where
A is the Final Investment Value
P is the Principal amount of money to be invested
r is the rate of interest in decimal
t is Number of Time Periods
n is the number of times interest is compounded per year
in this problem we have
[tex]t=10\ years\\ A=\$20,000\\ r=8\%=8/100=0.08\\n=4[/tex]
substitute in the formula above
[tex]20,000=P(1+\frac{0.08}{4})^{4*10}[/tex]
Solve for P
[tex]20,000=P(1.02)^{40}[/tex]
[tex]P=20,000/(1.02)^{40}[/tex]
[tex]P=\$9,057.81[/tex]
