document.write( "Question 1135512: Suppose you invest $140 at the end of each month for 5 years into an account earning 9% annual interest compounded monthly. After 5 years, you leave the money, without making additional deposits, in the account for another 28 years. How much will you have in the end?\r
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Algebra.Com's Answer #753129 by ikleyn(52781)\"\" \"About 
You can put this solution on YOUR website!
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\n" ); document.write( "\n" ); document.write( "It is ELEMENTARY . . . \r
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document.write( "STEP 1.  Determine future value after first 5 years.\r\n" );
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document.write( "We have classic Ordinary Annuity saving plan  (see the lessons \r\n" );
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document.write( "    - Ordinary Annuity saving plans and geometric progressions\r\n" );
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document.write( "    - Solved problems on Ordinary Annuity saving plans \r\n" );
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document.write( "in this site).\r\n" );
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document.write( "Future Value  FV = \"P%2A%28%28%281%2Br%29%5En-1%29%2Fr%29\",    (1)\r\n" );
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document.write( "where  FV is the future value of the account;  P is the monthly payment (deposit); r is the monthly percentage yield presented as a decimal; \r\n" );
document.write( "n is the number of deposits (= the number of years multiplied by 12, in this case).\r\n" );
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document.write( "Under the given conditions, P = 140;  r = 0.09/12;  n = 12*5 = 60.  So, according to the formula (1), you get at the end of the 5-th year\r\n" );
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document.write( "    FV = \"140%2A%28%28%281%2B0.09%2F12%29%5E60-1%29%2F%28%280.09%2F12%29%29%29\" = = $10,559.38.\r\n" );
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document.write( "STEP 2.  without making additional deposits, in the account for another 28 years.\r\n" );
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document.write( "    FV = \"10559.38%2A%281%2B0.09%2F12%29%5E%2812%2A28%29\" = 130,010 dollars.\r\n" );
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document.write( "ANSWER.  At the end, the account will be $130,010.\r\n" );
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\n" ); document.write( "\n" ); document.write( "For Ordinary Annuity saving plans see my lessons I referred above.\r
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