SOLUTION: Find the amount of an annuity with $2500 deposited quarterly at 8% for four years A. $46,598.21 B $3,300.00 C. $13,200.00 D $43,200.00

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Question 84980: Find the amount of an annuity with $2500 deposited quarterly at 8% for four years

A. $46,598.21
B $3,300.00
C. $13,200.00
D $43,200.00
Answer by stanbon(75887) About Me  (Show Source):
You can put this solution on YOUR website!
Find the amount of an annuity with $2500 deposited quarterly at 8% for four years

A. $46,598.21
B $3,300.00
C. $13,200.00
D $43,200.00
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Formula: S = R[(1+i)^n - 1]/i
S is Future Value
R is Periodic deposit
i=0.08/4 = 0.02 is periodic rate.
n= 4*4 is number of periods.
-----------------
S = 2500[1.02^(4*4) - 1]/[0.08/4]
S = 2500[.3727857/0.02]
S = 2500[18.639285]
S = $46,598.21
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Cheers,
Stan H.