Sara wants to have $530,000 in her savings account when sheretires. How much must she put in the account now, if the accountpays a fixed interest rate of 9%, to ensure that she has $530,000 in18 years time?OA. $112,357OB. $202,243OC. $119,492O D. $157,300

Present value illustrates the current value of a sum of money that will be received or paid in the…

retires. How much must she put in the account now, if the accour pays a fixed interest rate of 9%, to ensure that she has $530,000 in 18 years time? OA. $112,357 OB. $202,243 OC. $119,492 OD. $157,300

retires. How much must she put in the account now, if the accour pays a fixed interest rate of 9%, to ensure that she has $530,000 in 18 years time? OA. $112,357 OB. $202,243 OC. $119,492 OD. $157,300

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

ChapterA: Appendix - Time Value Of Cash Flows: Compound Interest Concepts And Applications

Section: Chapter Questions

Problem 13E

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Concept explainers

Effective Interest Rate

The term interest rate can be defined as the amount that is charged by the lender as a percentage on the principal amount. Interest rate which is charged annually is known as annual percentage rate.

Question

Sara wants to have $530,000 in her savings account when she
retires. How much must she put in the account now, if the account
pays a fixed interest rate of 9%, to ensure that she has $530,000 in
18 years time?
OA. $112,357
OB. $202,243
OC. $119,492
O D. $157,300

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