Since these are simple, ordinary annuities, the regular deposits happen at the same frequency as interest is applied, and we can use this formula:
FV = R [(1 + i)^n] / i
A)
FV = 2550 [(1 + 0.097)^7] / 0.097
FV = 2550 [1.097^7] / 0.097
FV = $ ______. __ (Round to 2 decimal places)
B) This question doesn't clearly state whether the $1380 regular deposits are semi-annually, to match when the interest is applied. If they are, you can use the above formula, remembering to adjust i and n accordingly (If not, it may be that you are expected to use a regular semi-annual deposit of $1380/2 = $690).
determine the amount of each ordinary simple annuity. deposits of $2550 for 7 years at 9.7% per year compounded annually
Search instead for determine the amount of each ordinary simple annuity. deposits of $2550 for 7 years at 9.7% per year compounded annually.
B) Deposits of 1380 for 4 years at 10% per year compounded semi annually.
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