We want the future value to be $600. With an interest of 4% quarterly in 3 years, we have the following information:
[tex]\begin{gathered} FV=600 \\ i=0.04 \\ t=3 \\ n=4 \end{gathered}[/tex]Then we apply the following formula:
[tex]PV=\frac{FV}{(1+\frac{i}{n})^{n\cdot t}}[/tex]therefore, we have that:
[tex]PV=\frac{600}{(1+\frac{0.04}{4})^{4\cdot3}}=\frac{600}{(1.01)^{12}}=532.46[/tex]therefore, Donald would have to deposit $532.46 as principal.
