A businessman wants to have sh. 40000 in 8 years. How much money must he invest now if the rate of interest is 7.5% p.a....

A businessman wants to have sh. 40000 in 8 years. How much money must he invest now if the rate of interest is 7.5% p.a. compound interest?

Answers

Using the compound interest formula
A = sh. 40000
r= 7.5% per period
n = 8 interest period
therefore P(1 +7.5/100)^8 = 40000
P(1.075)^8 = 40000
P = 40000/(1.075)^8
P= sh. 22428.09

---

joseph rimiru answered the question on November 16, 2017 at 19:08

Next:  Find the accumulated amount if sh. 40000 is deposited for 4 ½ years at 10% p.a. compound interest.
Previous:  Find the rate per annum at which a certain amount of money triples after being invested for a period of 5 years compounded annually.

View More Mathematics Questions and Answers | Return to Questions Index

Exams With Marking Schemes

• Grade 1
• Grade 2
• Grade 3
• Grade 4
• Grade 5
• Grade 6
• Grade 7
• Grade 8
• Grade 9
• PP1
• PP2
• Playgroup
• Form 1
• Form 2
• Form 3
• Form 4

Related Questions

• Find the accumulated amount if sh. 40000 is deposited for 4 ½ years at 10% p.a. compound interest.(Solved)
  

  Find the accumulated amount if sh. 40000 is deposited for 4 ½ years at 10% p.a. compound interest.

  Date posted: November 16, 2017.  Answers (1)

• What would sh. 30000 amount to after three years at 16% p.a. compounded quarterly?(Solved)
  

  What would sh. 30000 amount to after three years at 16% p.a. compounded quarterly?

  Date posted: November 16, 2017.  Answers (1)

• The equation of a straight line L₁ is given by 2y + 8x - 10 = 0. Another line L₂ cuts L₁ at right angles...(Solved)
  

  The equation of a straight line L₁ is given by 2y + 8x - 10 = 0. Another line L₂ cuts L₁ at right angles such that the point of intersection of the two lines has coordinates (-3,k).
  (a) Find the value of k
  (b) Hence find the equation of L₂

  Date posted: November 16, 2017.  Answers (1)

• Find the amount at the end of the fourth year if sh. 60000 is deposited at 15% p.a. compound interest.(Solved)
  

  Find the amount at the end of the fourth year if sh. 60000 is deposited at 15% p.a. compound interest.

  Date posted: November 16, 2017.  Answers (1)

• Find the amount after 2 years if sh. 10000 is invested at 20% p.a. compound interest.(Solved)
  

  Find the amount after 2 years if sh. 10000 is invested at 20% p.a. compound interest.

  Date posted: November 16, 2017.  Answers (1)

• John invested a certain amount of cash in a bank which paid 12% p.a. simple interest. After 10 years, his total saving were sh. 10000....(Solved)
  

  John invested a certain amount of cash in a bank which paid 12% p.a. simple interest. After 10 years, his total saving were sh. 10000. Determine the amount of money he invested initially.

  Date posted: November 16, 2017.  Answers (1)

• Calculate the rate of interest if sh. 9000 earns sh. 1000 after sh. 9000 earns sh. 1000 after 1 ½ years.(Solved)
  

  Calculate the rate of interest if sh. 9000 earns sh. 1000 after sh. 9000 earns sh. 1000 after 1 ½ years.

  Date posted: November 16, 2017.  Answers (1)

• Calculate the simple interest and the amount on sh. 8000 for 1 ½ years at 14% per annum.(Solved)
  

  Calculate the simple interest and the amount on sh. 8000 for 1 ½ years at 14% per annum.

  Date posted: November 16, 2017.  Answers (1)

• Find the simple interest earned on sh. 1000 at 12% per annum for a. 1 year b. 2 years c. 3 years (Solved)
  

  Find the simple interest earned on sh. 1000 at 12% per annum for
  a. 1 year
  b. 2 years
  c. 3 years
  

  Date posted: November 16, 2017.  Answers (1)

• Solve for a in log (3a + 4) – log (3-a) =1(Solved)
  

  Solve for a in log (3a + 4) – log (3-a) =1

  Date posted: November 16, 2017.  Answers (1)

• Solve the following Log x = 3 log 2(Solved)
  

  Solve the following
  Log x = 3 log 2
  

  Date posted: November 16, 2017.  Answers (1)

• Find without using tables if 2 + log 3 +log y = log 5 +1(Solved)
  

  Find without using tables if 2 + log 3 +log y = log 5 +1

  Date posted: November 16, 2017.  Answers (1)

• Solve for x in log x + log 6 = log 36 (Solved)
  

  Solve for x in log x + log 6 = log 36

  Date posted: November 16, 2017.  Answers (1)

• Simplify (a) Log (a + 1) – log (a^2 -1) (b) Log x^4 +log x (c) Log 15 + log 3 – log...(Solved)
  

  Simplify
  a. Log (a + 1) – log (a^2 -1)
  b. Log x^4 +log x
  c. Log 15 + log 3 – log 9
  

  Date posted: November 15, 2017.  Answers (1)

• Simplify (a) ½ log 9 –log 3 (b) 3 – 2 log 5 (c) Log 16 –log 8(Solved)
  

  Simplify
  a. ½ log 9 –log 3
  b. 3 – 2 log 5
  c. Log 16 –log 8
  

  Date posted: November 15, 2017.  Answers (1)

• Simplify (a) Log 6 +log 4 (b) Log 4 – log 2 (c) Log 60 – log 20(Solved)
  

  Simplify
  a. Log 6 +log 4
  b. Log 4 – log 2
  c. Log 60 – log 20
  

  Date posted: November 15, 2017.  Answers (1)

• Express in terms of x, y, and z given that log a =x, log b =y and log c = z (a) Log a^2b (b) Log...(Solved)
  

  Express in terms of x, y, and z given that log a =x, log b =y and log c = z
  a. Log a^2b
  b. Log (a/b)
  c. Log (a^2b/c)
  

  Date posted: November 15, 2017.  Answers (1)

• State the three laws of logarithms.(Solved)
  

  State the three laws of logarithms.

  Date posted: November 15, 2017.  Answers (1)

• Express the following in terms log x, log y, and log z (a)Log xy (b) Log xyzc. Log (x/y)(Solved)
  

  Express the following in terms log x, log y, and log z
  a. Log xy
  b. Log xyz
  c. Log (x/y)
  

  Date posted: November 15, 2017.  Answers (1)

• Express in terms of log x, log y: log (x^2/y^3)(Solved)
  

  Express in terms of log x, log y: log (x^2/y^3)

  Date posted: November 15, 2017.  Answers (1)