document.write( "Question 1198679: Jane Adele deposits $1,300 in an account at the beginning of each 3-month period for 12 years. If the account pays interest at the rate of 4%, compounded quarterly, how much will she have in her account after 12 years?
\n" ); document.write( " \n" ); document.write( "

Algebra.Com's Answer #832309 by ikleyn(52786) $\"\"$ $\"About$

You can put this solution on YOUR website!
.
\n" ); document.write( "Jane Adele deposits $1,300 in an account at the beginning of each 3-month period for 12 years.
\n" ); document.write( "If the account pays interest at the rate of 4%, compounded quarterly,
\n" ); document.write( "how much will she have in her account after 12 years?
\n" ); document.write( "~~~~~~~~~~~~~~~~~~~\r
\n" ); document.write( "
\n" ); document.write( "\n" ); document.write( "

\r\n" );
document.write( "It is a classic Annuity Due saving plan. The general formula is \r\n" );
document.write( "\r\n" );
document.write( "\r\n" );
document.write( "    FV = ,    (1)\r\n" );
document.write( "\r\n" );
document.write( "\r\n" );
document.write( "where  FV is the future value of the account;  P is the quarterly payment (deposit) \r\n" );
document.write( "at the beginning of each payment period; r is the quarterly percentage yield presented as a decimal; \r\n" );
document.write( "n is the number of deposits (= the number of years multiplied by 4, in this case).\r\n" );
document.write( "\r\n" );
document.write( "\r\n" );
document.write( "Under the given conditions, P = 1300;  r = 0.04/4 = 0.01;  n = 12*4 = 48.  \r\n" );
document.write( "So, according to the formula (1), Jane Adele will get at the end of the 4-th year\r\n" );
document.write( "\r\n" );
document.write( "\r\n" );
document.write( "    FV =  =   = $80385.28  (rounded).\r\n" );
document.write( "\r\n" );
document.write( "\r\n" );
document.write( "Note that Jane Adele will deposit only  12*4*$1300 = $62400 in 12 years.  \r\n" );
document.write( "The rest is what the account earns/accumulates in 12 years.\r\n" );
document.write( "

\r
\n" ); document.write( "\n" ); document.write( "-----------------\r
\n" ); document.write( "
\n" ); document.write( "\n" ); document.write( "On Annuity Due saving plans, see the lesson\r
\n" ); document.write( "\n" ); document.write( " - Annuity Due saving plans and geometric progressions\r
\n" ); document.write( "\n" ); document.write( "in this site.\r
\n" ); document.write( "
\n" ); document.write( "\n" ); document.write( "This lesson contains EVERYTHING you need to know about this subject, in clear and compact form.\r
\n" ); document.write( "
\n" ); document.write( "
\n" ); document.write( "\n" ); document.write( " \n" ); document.write( "

\n" );