How Much Money Do You Need to Put in a CD

question 23

Essay

How much money do you need to put in a CD (certificate of deposit) with an interest rate of 7.5% compounded annually today so that it is worth $5,000 in 3 years?

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Definitions:

Net Income

The total profit of a company after all expenses, including taxes and operating expenses, are subtracted from total revenue.

Break-Even Point

The point at which the amount produced or sold results in total income matching total costs, leading to neither a profit nor a loss.

Net Loss

The amount by which expenses exceed revenues over a specific period, indicating a negative financial performance.

Target Profits

The specific amount of net income a company aims to achieve within a certain time frame.