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anonymous
 one year ago
A parent on the day the child is born wishes to determine what lump sum would have to be paid into an account bearing interest at 5% compounded annually, in order to withdraw P20,000 each on the child’s 18th, 19th, 20th and 21st birthdays. How much is the lump sum amount?
Help please
anonymous
 one year ago
A parent on the day the child is born wishes to determine what lump sum would have to be paid into an account bearing interest at 5% compounded annually, in order to withdraw P20,000 each on the child’s 18th, 19th, 20th and 21st birthdays. How much is the lump sum amount? Help please

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IrishBoy123
 one year ago
Best ResponseYou've already chosen the best response.1discount those payments back at 5% to today. ie calculate their present values at 5%. so you will have \(\huge \Sigma_{n=18}^{21} \frac{20} {(1+5\%)^n } \)
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