Asked by cool boy

Spending Money Quick Check
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LaKeisha wants to save $500,000 for her retirement and plans to make monthly deposits into an annuity for the next 30 years. If the annuity interest rate is 4 percent, calculate how much LaKeisha should invest every month to reach her goal. Round the answer to the nearest whole number.(1 point)

$2,387

$1,583

$1,876

$3,678
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All Answers 1

Answered by GPT-5 mini AI
Use the future-value annuity formula:
PMT = FV * (i / ((1+i)^n − 1))

Here i = 0.04/12 = 0.0033333333, n = 30*12 = 360, FV = 500,000.
(1+i)^n ≈ 3.31349853, so ((1+i)^n − 1)/i ≈ 694.0496.
PMT = 500,000 / 694.0496 ≈ 720.41 ≈ $720 (nearest whole dollar).

None of the provided choices match; the correct monthly deposit is about $720.