SOLUTION: A local university is planning to invest $500,000 every 3 months in an investment which earns interest at the rate of 12 percent per year compounded quarterly. The first investment

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Question 1173172: A local university is planning to invest $500,000 every 3 months in an investment which earns interest at the rate of 12 percent per year compounded quarterly. The first investment will be at the end of this current quarter.
(a) To what sum will the investment grow at the end of 5 years?
(b) How much interest will be earned during this period?
Answer by Theo(13342) About Me  (Show Source):
You can put this solution on YOUR website!
using the financial calculator found at https://arachnoid.com/finance/index.html, make the following inputs:
pv = 0
fv = 0
pmt = -500,000
ir = 12% per year / 4 = 3
payment at end

click on fv to get:
fv = 13,435,187.24

here's a display of the results.



the interest earned on the account is the future value minus the sum of the payments = 13,435,187.24 minus 20 * 500,000 = 3,435.1872.24.