quarterly rate: 0.08 / 4 = 0.02
number of periods "n": 5 years x 4 qtrs. per year = 20
PV = FV / (1 + r)^n
PV = 50,000 / 1.02^20
= 50,000 / 1.48595
= $33,648.56665, round to $33,648.57
Go to bankrate.com, calculators for anything you need to know.
Davy Johns will need $50,000 in 5 years. How much must he invest now at 8% compounded quarterly to have $50,000 in his account, 5 years from now?
