1 Required information Durco Automotive needs a 2 million ba

1 Required information Durco Automotive needs a $2 million balance in its contingency fund 3 years from now. The chief financial officer (CFO) wants to know how much to deposit now into Durco\'s high-yield investment account. Determine the amount if it grows at a rate of 14% per year using compound interest. The amount if it grows at a rate of 14% per year using compound interest is $ | 3036531099|

Solution

amount to be received in later time (A) = 2 million= 2000000

time(n) = 3 years

interest rate (i)= 14%

we need to get the principal...so,

Amount= principal (1+i)^n

2000000 = P (1.14)^3

2000000 = P* 1.481544

P= 1349943.0324

So he needs to invest 1349943.032 to get 2 million after 3 years