Asked by Jessie

Annual deposits of $3150 are made into a bank account earning 4 % interest per year. Round all answers to two decimal places

(a) What is the balance in the account right after the 15th deposit if interest is calculated annually?

For this I know the formula is
A = P(1 + R/N)^Nt

A = 3150( 1 + 0.04/1)^1(15)

A = 5,672.97





(b) What is the balance in the account right after the 15th deposit if interest is calculated continuously?

For this I know the formula is
A = Pe^rt

A = 3150e^(0.03 x 15)

A = 4,940.18
Answered by Damon
sorry, no. Your formulas are for ONE deposit at the start, not for annual deposits.

Look up "amount of a sinking fund"
S = 3150[ 1.04^n - 1 ] /.04
Answered by Damon
You get e^rt for EACH deposit for its time t
3150 [ e^14(.04) + e^13(.04) + ....e^.04]

I am sorry I do not know an easy way to do that
Answered by Damon
The formulas are for the END of the year
so do it for 14 years, then add that 15th deposit of 3150 (tricky wording)
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