Compounding/Investment Question

[eleventhxhour]

Bob wants to throw a party when he graduates from high school in five years. He needs $10000. He can invest in a GIC which pays 6% compounded daily. How much must he invest today?

 

[Jameson]

Bob wants to throw a party when he graduates from high school in five years. He needs $10000. He can invest in a GIC which pays 6% compounded daily. How much must he invest today?

Let's start with the formula for compound interest: $$A=P \left(1+\frac{r}{n} \right)^{nt}$$, where $A$ is the new total amount after calculating interest, $P$ is the amount of money you start with, $r$ is the percent interest (in decimal form), $n$ is the number of times the interest is calculated per year and finally $t$ is the number of years.

Let's start this way. We have all the variables in the equation except for one. What are we missing?