SOLUTION: you deposite 5000 each year in to an account. earning 4% interest compounded annually how much will you have in the account in 20 years

Question 1203871: you deposite 5000 each year in to an account. earning 4% interest compounded annually how much will you have in the account in 20 years
Answer by Theo(13342) (Show Source): You can put this solution on YOUR website!
i used the calculator at https://arachnoid.com/finance/

here are the results.

present value = 0
future value = 0
amount invested at the end of each year = 5000.
interest rate per year = 4%.
number of year = 20.

calculator says that the future value is equal to 148,890.39.

this is similar to the results you would get from the sum of a geometric series.
the formula for that is Sn = A * (1 - r^n)/(1-r).
A is the yearly payment.
r is the growth rate per year.
n is the number of years.
the formula becomes An = 5000 * (1 - 1.04^20)/(1-1.04) = 148,890.39.

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