Sarah wants to save $20,000 to use for a down payment on a home. She deposits some money into a 4-year certificate of deposit (CD) with an annual interest rate of 4.5% compounded monthly. How much does Sarah need to deposit in the CD to reach her goal of having $20,000 in 4 years? Round your final answer to the nearest dollar.
Hint: Use the formula PV=(S)/((1+i)^(n)).
$16,711
$12.583
$5,000
$4,785
down payment on a home. She deposits
some money into a 4-year certificate of
deposit (CD) with an annual interest rate of
4.5% compounded monthly. How much
does Sarah need to deposit in the CD to
reach her goal of having $20,000 in 4 years? Round your final answer to the nearest dollar.
S
Hint: Use the formula PV= 1+
$16,711
$12.583
$5,000
$4,785