Calculate the value of $500 saved each year for 12 years at 7%. Is this a...
- Calculate the value of $500 saved each year for 12 years at 7%.
Is this a present value or future value problem? Is it an annuity or single amount?
Homework Answers
Answer:
Annual saving = $500
Time period = 12 years
Interest rate = 7%
Future value = $500*1.07^11 + $500*1.07^10 + … + $500*1.07 +
$500
Future value = $500 * (1.07^12 - 1) / 0.07
Future value = $500 * 17.88845
Future value = $8,944.23
It is a future value problem as it is asking value of $500 saving for 12 years.
It is an annuity as it is series of payment of $500 each for 12 years.
Add Answer to:
Calculate the value of $500 saved each year for 12 years at
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Note: Only use the formula listed and show the steps of how you
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provided a list of formulas, please state the...
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