Question 3 bank offers a CD that pays a simple interest rate of \( 5.0 \% \). How much must you eposit now in the CD in order to have \( \$ 4,000 \) in 6 years? und to the nearest cent. \( \$ 3502.76 \) \( \$ 2845.32 \) 2984.86 3076.92

To find out how much you need to deposit now in a certificate of deposit (CD) to earn $4,000 in 6 years at a simple interest rate of 5%, you can use the formula for simple interest: \[ A = P(1 + rt) \] Here, \( A \) is the amount you want to have ($4,000), \( r \) is the interest rate (0.05), and \( t \) is the time in years (6). Rearranging the formula to find \( P \): \[ P = \frac{A}{1 + rt} = \frac{4000}{1 + (0.05 \cdot 6)} = \frac{4000}{1.3} \approx 3076.92 \] So, to have $4,000 after 6 years, you'd need to deposit approximately $3,076.92. If you think saving money is just a boring chore, think again! Consider looking for high-interest CDs to grow your funds even faster, or maybe even online banks offering competitive rates. Don't forget that knowing the rules of the financial game can lead to some serious wins! Leaving money in low-interest accounts? That's a common mistake many people make! Instead of scrolling through social media while daydreaming about savings, do a quick calculation or consult a financial advisor to find the best options available. Your future self (and wallet) will thank you!