Question
Jaya deposits $820 every month into an account earning an annual interest rate of 5.7% compounded monthly. How much would she have in the account after 9 years, to the nearest dollar? Use the following formula to determine your answer.
Answers
GPT 3.5
The formula to calculate the future value of an account with regular monthly deposits and compound interest is:
FV = Pmt * (((1 + r/n)^nt - 1) / (r/n)) + Pmt * ((1 + r/n)^(nt))
where:
FV = Future Value
Pmt = Monthly Deposit (in this case, $820)
r = Annual Interest Rate (in this case, 5.7% or 0.057)
n = Number of compounding periods per year (in this case, monthly, so n = 12)
t = Number of years the money is invested for (in this case, 9 years)
Plugging in the values:
FV = $820 * (((1 + 0.057/12)^(12*9) - 1)/(0.057/12)) + $820 * ((1 + 0.057/12)^(12*9))
After calculating this, the approximate answer is $112,140.
FV = Pmt * (((1 + r/n)^nt - 1) / (r/n)) + Pmt * ((1 + r/n)^(nt))
where:
FV = Future Value
Pmt = Monthly Deposit (in this case, $820)
r = Annual Interest Rate (in this case, 5.7% or 0.057)
n = Number of compounding periods per year (in this case, monthly, so n = 12)
t = Number of years the money is invested for (in this case, 9 years)
Plugging in the values:
FV = $820 * (((1 + 0.057/12)^(12*9) - 1)/(0.057/12)) + $820 * ((1 + 0.057/12)^(12*9))
After calculating this, the approximate answer is $112,140.