document.write( "Question 1198230: Bola,who plans to retire in 15 years contribute#1000 to an individual retirement plan semi annually. What will be the amount of annuity if the rate is 10% compounded annually
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Algebra.Com's Answer #831788 by ikleyn(52786)\"\" \"About 
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document.write( "It is a classic Ordinary Annuity saving plan. The general formula is \r\n" );
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document.write( "    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 semi-annual payment (deposit); \r\n" );
document.write( "r is the semi-annual percentage yield presented as a decimal; \r\n" );
document.write( "n is the number of deposits (= the number of years multiplied by 2, in this case).\r\n" );
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document.write( "Under the given conditions, P = 1000;  r = 0.1/2 = 0.05;  n = 2*15 = 30.  \r\n" );
document.write( "So, according to the formula (1), Bola gets at the end of the 15-th year\r\n" );
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document.write( "    FV = \"1000%2A%28%28%281%2B0.1%2F2%29%5E%282%2A15%29-1%29%2F%28%280.1%2F2%29%29%29\" = \"1000%2A%28%281.05%5E30-1%29%2F0.05%29\" = $66438.85.\r\n" );
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document.write( "Note that Bola deposits only  2*15*$1000 = $30,000.  The rest is what the account earns/accumulates in 15 years.\r\n" );
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\n" ); document.write( "\n" ); document.write( "On Ordinary Annuity saving plans,  see the lessons\r
\n" ); document.write( "\n" ); document.write( "    - Ordinary Annuity saving plans and geometric progressions\r
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\n" ); document.write( "\n" ); document.write( "The lessons contain  EVERYTHING  you need to know about this subject,  in clear and compact form.\r
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\n" ); document.write( "\n" ); document.write( "When you learn from these lessons,  you will be able to do similar calculations in semi-automatic mode.\r
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