In order to accumulate $5,000, you will deposit $100 at the end of each month for...
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In order to accumulate $5,000, you will deposit $100 at the end of each month for as long as necessary. Interest is 15% compounded monthly. (a) Find the number of regular payments and the fractional period that are required to accumulate the $5,000? (b) If a final fractional payment will be added to the last regular payment, what must this fractional payment be? (c) If a final fractional payment will be made one month after the last regular payment, what must this fractional payment be? (d) If the fractional payment to be made during the month following the last regular payment. In order to accumulate $5,000, you will deposit $100 at the end of each month for as long as necessary. Interest is 15% compounded monthly. (a) Find the number of regular payments and the fractional period that are required to accumulate the $5,000? (b) If a final fractional payment will be added to the last regular payment, what must this fractional payment be? (c) If a final fractional payment will be made one month after the last regular payment, what must this fractional payment be? (d) If the fractional payment to be made during the month following the last regular payment.
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Answer rating: 100% (QA)
To solve this problem we can use the future value of an ordinary annuity formula FV P 1 rn 1r ight Where FV future value P regular payment r interest ... View the full answer
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date:
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