Answer to Question #246874 in Financial Math for khongla

Question #246874

What is the amount of money that Lebo has to invest, at a simple interest rate of 12%

per year, to earn R5250,00

interest after three years?

Expert's answer

"FV=PV(1+r)^n"

"FV-PV=PV((1+r)^n-1)=5250"

"PV=\\frac{5250}{(1+r)^n-1}=\\frac{5250}{1.12^3-1}=R12965.27"

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