Question 1103899: Taylor deposits $3,500 at the end of year 1, $4,000 at the end of year 3 and $2,500 at the end of year 5. If interest is 6.2% compounded monthly, determine the value at the end of year 7
Found 2 solutions by Boreal, Theo:
Answer by Boreal(15235)   (Show Source):
You can put this solution on YOUR website! At the end of year 1, $3500
at the end of year 3, 3500(1+(.062/12))^24=$3960.79
puts in 4000 more so $7960.79.
That is compounded for 24 months to give 7960.79(1+.062/12)^24=$9008.86.
Puts in 2500 more to have $11508.86
That is compounded for 24 months to give 11508.86(1+(.062/12)^24=$13024.05
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rough check--deposited $10000 at 6.2% for 7 years--this is an overestimate: (1+.062/12)^84 is multiplier, which is $15,417. If I use an average of 48 months for the whole amount, it is $12,806.
Answer by Theo(13342)  (Show Source):
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