You deposit $1,000 at the end of each year into an account paying 10.6 percent interest....

Question

Question

You deposit $1,000 at the end of each year into an account paying 10.6 percent interest.

a.	How much money will you have in the account in 16 years?

b.	How much will you have if you make deposits for 32 years?

Answer 1

Answer #1

a. Future Value of Annuity = Annuity Payment * [ {( 1+ Rate of Interest)^Time - 1 } / rate of Interest ]

= 1000*[ {( 1+ 10.6%)^16- 1 } /10.6%]

= $ 37,856.78

Answer : $ 37,856.78

b. Future Value of Annuity = Annuity Payment * [ {( 1+ Rate of Interest)^Time - 1 } / rate of Interest ]

= 1000*[ {( 1+ 10.6%)^32- 1 } /10.6%]

= $ 227,625.99

Answer :$ 227,625.99

Answer 2

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