Homework Answers
| Using the future value of annuity formula the amount to be deposited can be calculated | |||||
| Monthly interest rate | 6%/12 | ||||
| Monthly interest rate | 0.50% | ||||
| No of payments | 3*12 | ||||
| No of payments | 36 | ||||
| Annuity amount | Future value/Future value of annuity (i=0.50%,n=36) | ||||
| Annuity amount | 70000/39.3361 | ||||
| Annuity amount | $1,780 | ||||
| Thus, amount to be saved each month is $1,780 | |||||
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