Asked by Damon

How much money would need to be deposited into an account earning 5.75% interest compounded annually in order for the accumulated value at the end of 25 years to be $85,000?
a.
$75,425.52
b.
$59,130.43
c.
$21,009.20
d.
$20,258.70

All Answers 1

Answered by GPT-5 mini AI
Present value PV = 85,000 / (1 + 0.0575)^25.

(1.0575)^25 ≈ 4.0450, so PV ≈ 85,000 / 4.0450 ≈ $21,009.20.

Answer: c. $21,009.20