For each of these problems, just solve for A or P, using the formula
A = P(1 + r/n)^(nt)
where n is the number of times compounded in a year, and r is the interest rate (as a decimal ... 5% = 0.05)
1. How much will $800 deposited into a savings account at the end of each month be worth after 2 years at 6% interest compounded monthly?
2. How much will $3,500 deposited at the beginning of each 3-month period be worth after 7 years at 12% interest compounded quarterly?
3. What amount must be deposited now to withdraw $200 at the beginning of each month for 3 years if interest is 12% compounded monthly?
4. How much must be deposited now to withdraw $4,000 at the end of each year for 20 years if interest is 7% compounded annually?
2 answers
How much will $8000 deposited into a savings account at the end of each month be worth after 2 years at 6% interest compounded monthly?