Question

Haley won $25,000 in a lottery. She will spend some of her winnings now and
save the rest. The money Haley saves must amount to $45,000 in 25 years.
Haley can invest the money at 6.35% compounded monthly. About how much
could Haley spend now? How long will it take for money to double at 4 1/2% compounded quarterly?

Answer 1

Amount needed to get 45,000 in 25 years at 6.35% comp monthly
i = .0635/12 = .00529166..
n = 25(12) = 300

= 45000(1.005291666..)^-300
= 9.238.21
This is the amount he must invest to get his 45,000 25 years from now,
I suppose he can spend the rest of the $25,000

for money to double at 4.5% comp monthly ....
(1.00375)^n = 2
take log of both sides
log (1.00375)^n = log 2
n log 1.00375 = log 2
n = 185.19 months = appr 15.4 years