Parents wish to have 90000 available for a child's education. If the child is now 6 years old, how much money must be set aside at 3% compounded semiannually to meet their financial goal when the child is 18

$62959

Step-by-step explanation:

We have been given that Parents wish to have 90000 available for a child's education. The child is now 6 years old. We are asked to find the amount of money that parents must set aside at 3% compounded semiannually to meet their financial goal when the child is 18.

We will use compound interest formula to solve our given problem.

, where,

A = Final amount,

P = Principal amount,

r = Annual interest rate in decimal form,

n = Number of times interest is compounded per year.

t = Time in years.

Therefore, an amount of $62959 must be set aside to meet their financial goal when the child is 18.