the thread about nothing...

Looks like a brother is about to defer these student loans, **** ain't moving at the speed I expected.

I'm still living though :pimp:
 
Assume you want to accumulate $125,000 for a long-range goal in 40 years. You have two choices. Plan A is an account with annual compounding and an APR of 5%. Plan B is an account with continuous compounding and an APR of 4.5%. How much of an investment does each plan require to reach your goal?

How the freak do I figure this out??

Looks like you have to find the present value using both APR percentages, so for the annual APR, you have to take the future value (125,000) and divide that by 1+apr(5%) and raise that to the 40th power. for the other one though i'mm not too sure because it says continuous. you could use the same formula but you can't raise 1+apr to the 40th power since it's annually. I don't know if i'm right though. this is my first semester taking finance so all of this stuff is still new to me. hope this helps man.
 
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Assume you want to accumulate $125,000 for a long-range goal in 40 years. You have two choices. Plan A is an account with annual compounding and an APR of 5%. Plan B is an account with continuous compounding and an APR of 4.5%. How much of an investment does each plan require to reach your goal?
How the freak do I figure this out??

Plan A should be: F = 125000(1 + .05)^40
idk about plan b.
 
700
 
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