SOLUTION: Please Help: Find the future value of the ordinary annuity. Interest is compounded annually, unless otherwise indicated. R = $1000, i = 0.06, n = 11 A) $13,180.79 B) $14,97

Algebra ->  Equations -> SOLUTION: Please Help: Find the future value of the ordinary annuity. Interest is compounded annually, unless otherwise indicated. R = $1000, i = 0.06, n = 11 A) $13,180.79 B) $14,97      Log On


   

Question 201909: Please Help:
Find the future value of the ordinary annuity. Interest is compounded annually, unless otherwise indicated.
R = $1000, i = 0.06, n = 11
A) $13,180.79
B) $14,971.64
C) $31,638.31
D) $2984.75
Answer by Theo(13342) About Me  (Show Source):
You can put this solution on YOUR website!
answer is B (14,971.64)
formula is future worth of an annuity as shown below.
FV+%28Annuity%29+=+%28%28%281%2Br%29%5En+-+1%29%2Apmt%29%2Fr
FV (Annuity) means future value of the annuity.
r = interest rate per period
n = number of periods
pmt = payment per period
the assumption here is that the period is in years.
payment is made at the end of each year.
interest rate is compounded yearly.
note:
interest rate is the % interest divided by 100%.
example:
if % interest = 15%
then interest rate = .15