Answer:
Lucy needs to invest $55,194.16
Step-by-step explanation:
The given information are;
The interest rate of the account = 7% compounded daily
The amount at the end of 6 years = $84,000
The time duration = 6 years
The amount Lucy
The formula for compound interest is
[tex]A(t) = P \times \left ( 1 + \dfrac{r}{n} \right )^{n \times t}[/tex]
Where;
r = The interest rate = 7% = 0.07
n = The number of times a year = 365
t = The number years = 6 years
A(t) = The amount after 6 years = $84,000
P = The initial amount invested
Therefore, we have;
[tex]\$ 84,000 = P \times \left ( 1 + \dfrac{0.07}{365} \right )^{365 \times 6}[/tex]
[tex]P = \dfrac{\$84,000}{\left ( 1 + \dfrac{0.07}{365} \right )^{365 \times 6}} =\dfrac{\$84,000}{1.522} = \$55,194.16[/tex]
Therefore, Lucy needs to invest $55,194.16.
