SOLUTION: You are a freshman in college and are planning a trip to Europe when you graduate from college at the end of four years. You plan to save the following amounts annually, starting t

Question 1080906: You are a freshman in college and are planning a trip to Europe when you graduate from college at the end of four years. You plan to save the following amounts annually, starting today: $649, $698, $692, and $733. If the account pays 5.90 percent annually, how much will you have at the end of four years? (Round answer to 2 decimal places, e.g. 15.25.

Answer by Theo(13342) (Show Source): You can put this solution on YOUR website!
at the beginning of the first year, you save $649.
at the beginning of the second year, you save $698.
at the beginning of the third year, you save $692.
at the beginning of the fourth year, you save $733.

if the account pays 5.90 percent annually, then:

at the end of the fourth year:

649 invested at the beginning of the first year will be worth 649 * 1.059^4 = 816.26

698 invested at the beginning of the second year will be worth 698 * 1.059^3 = 828.98

692 invested at the beginning of the third year will be worth 692 * 1.059^2 = 776.06

733 invested at the beginning of the fourth year will be worth 733 * 1.059^1 = 776.25

add them up and you will have a total of $3197.55 at the end of 4 years.

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