At the time of the birth of a child, a parent wants to begin a college fund that will grow to $50000 by the child's 18th birthday. Interest is compounded continuously at 8.5%. What should the initial investment (P0) be?

Answer 1

50,000=PO*e^k18

ln 50,000= ln PO + .085*18

lnPO= 10.82-1.53=9.29
PO=10829.18

check that.

Answer 2

how many years will it take for $4,000 to reach $6,000 at a simple interest rate of 5