document.write( "Question 1201661: Please help me with this problem. Thank you for your help in advance!\r
\n" ); document.write( "\n" ); document.write( "*Three friends want $3,000,000 at the end of 10 years. How much money
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Algebra.Com's Answer #836130 by ikleyn(52832)\"\" \"About 
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\n" ); document.write( "Three friends want $3,000,000 at the end of 10 years. How much money
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document.write( "If the deposit is made regularly at the end of each month, such saving plan is called \r\n" );
document.write( "an Ordinary Annuity. The general formula for such a plan is \r\n" );
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document.write( "    FV = \"P%2A%28%28%281%2Br%29%5En-1%29%2Fr%29\",    \r\n" );
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document.write( "where  FV is the future value of the account;  P is the monthly payment (deposit); \r\n" );
document.write( "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( "From this formula, you get for the monthly payment \r\n" );
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document.write( "    P = \"FV%2A%28r%2F%28%281%2Br%29%5En-1%29%29\".     (1)\r\n" );
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document.write( "Under the given conditions, FV = $3,000,000;  r = 0.07/12;  n = 10*12 = 120.  \r\n" );
document.write( "So, according to the formula (1), you get for the monthly payment \r\n" );
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document.write( "    P = \"3000000%2A%28%28%280.07%2F12%29%29%2F%28%281%2B0.07%2F12%29%5E%2810%2A12%29-1%29%29\" = $17,332.55.\r\n" );
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document.write( "Answer.  The necessary monthly deposit value is $17,332.55.\r\n" );
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document.write( "Note that of projected $3,000,000, the total of deposits will be only  10*12 times $17,332.55, \r\n" );
document.write( "i.e. about 10*12*17332.55 = 2079906 dollars. The rest is what the account will earn/accumulate in 10 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
\n" ); document.write( "\n" ); document.write( "    - Solved problems on Ordinary Annuity saving plans\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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