SOLUTION: Please help me with this problem. Thank you for your help in advance! *Three friends want $3,000,000 at the end of 10 years. How much money should they put into an account eac

If the deposit is made regularly at the end of each month, such saving plan is called 
an Ordinary Annuity. The general formula for such a plan is 


    FV = ,    


where  FV is the future value of the account;  P is the monthly payment (deposit); 
r is the monthly percentage yield presented as a decimal; 
n is the number of deposits (= the number of years multiplied by 12, in this case).


From this formula, you get for the monthly payment 


    P = .     (1)


Under the given conditions, FV = $3,000,000;  r = 0.07/12;  n = 10*12 = 120.  
So, according to the formula (1), you get for the monthly payment 


    P =  = $17,332.55.


Answer.  The necessary monthly deposit value is $17,332.55.


Note that of projected $3,000,000, the total of deposits will be only  10*12 times $17,332.55, 
i.e. about 10*12*17332.55 = 2079906 dollars. The rest is what the account will earn/accumulate in 10 years.