FV = PMT ([1+I]^N - 1)/I
FV = future value
I = interest
N = number of periods
PART A:
Set FV = $550,000
Set I = 0.048/4 = 0.012
Set N = 35yr×4qtr/yr = 140 qtr
PMT = 550,000×I/([1+I]^N - 1)
PMT = 550,000×0.012/([1.012]^140-1) = $1,530.55
PART B:
$1,530.55 × 140 = 214,277.42
PART C:
550,000 - 214,277.42 = 335,722.58
Annuities /assessment You would like to have $550,000 when you retire in 35 years.
You would like to have $550,000 when you retire in 35 years. How much should you invest each quarter if you can earn a rate of 4.8% compounded quarterly?
a) How much should you deposit each quarter?
b) How much total money will you put into the account?
c) How much total interest will you earn?
1 answer
0 answers