Question

Jennifer has		$6,000	invested in a money market account
that pays 1.5% interest compounded monthly at the end of
each month. She makes deposits at the end of each month
of	$250	. How much will she have in the account
after 3 years?
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Answer 1

Future value of annuity formula can be used for solving this Future value of annuity is = [P*((1+r)^n-1)/r] Future value of annuity is = Amount in the account - ? "P" is Monthly deposit = 5 250/. "r" is Monthly rate of interest = 1.50%/12 - 0.1250% "n" is No of months = (3*12)=36 Future value of annuity is = [250*((1+0.00001250) 36-1)/0.00001250] Future value of annuity is = [250*36.00787612] Future value of annuity is = 5 9,001.96 Future value of annuity is - $ 9,002/. She will have $ 9,002 in the account after 3 years.