SOLUTION: hank and peggy are saving money to purchase a new pickup truck. They decide to deposit $100 per month into an account paying 5.25% interest compounded monthly. Determine the value
Question 1074811: hank and peggy are saving money to purchase a new pickup truck. They decide to deposit $100 per month into an account paying 5.25% interest compounded monthly. Determine the value of their account after 5 years. Found 2 solutions by addingup, MathTherapy:Answer by addingup(3677) (Show Source): You can put this solution on YOUR website! A = PMT((1+APR/n)^(nY)-1)/(APR/n)
A = 100((1+0.0525/12)^(12*5)/(0.0525/12)
Solve using your calculator, one step at a time: 0.0525/12; the result +1, the result to the power of 12*5, the result divided by 0.0525/12, and finally the result times 100.
You should get:
A = 29,701
Happy learning,
John Answer by MathTherapy(10552) (Show Source): You can put this solution on YOUR website! hank and peggy are saving money to purchase a new pickup truck. They decide to deposit $100 per month into an account paying 5.25% interest compounded monthly. Determine the value of their account after 5 years.
Correct answer: FYI: The FUTURE VALUE of 60 $100 monthly payments cannot amount to over $29,000 in 5 years, unless of course,
it's invested at an interest rate of about 55%. So, IGNORE anyone who suggests that that amount is correct!