a) If your savings account earns 6% per annum, compounded annually, how much do you have in
Question:
a) If your savings account earns 6% per annum, compounded annually, how much do you have in your account at the end of 10 years if you deposit $10,000 per year into the account?
b) How much will you have to deposit each year into his college fund account that pays an interest rate of 4% per annum, compounded annually, if at the end of 18 years, you want to have $200,000 in the account? (Round your answer to the nearest $100)
c) You decide to make monthly deposits into Junior's college fund account (the account pays interest at 4%), instead of annual deposits. How much must you deposit at the end of each month so that you will have $200,000 in the account by the time he turns 18? (Round to the nearest dollar.)
Foundations of Finance The Logic and Practice of Financial Management
ISBN: 978-0132994873
8th edition
Authors: Arthur J. Keown, John D. Martin, J. William Petty