SOLUTION: What is the furture value of a 5-year annuity due that promises to pay you $300 each year? Assume that all payments are reinvested at 7% a year, until year 5. I am so frustrat

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Question 92296: What is the furture value of a 5-year annuity due that promises to pay you $300 each year? Assume that all payments are reinvested at 7% a year, until year 5.

I am so frustrated with this. I have come up with too many different figures to the point I am now confused. Please help.
Answer by stanbon(75887) About Me  (Show Source):
You can put this solution on YOUR website!
What is the furture value of a 5-year annuity due that promises to pay you $300 each year? Assume that all payments are reinvested at 7% a year, until year 5.
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Future Value = R[(1+i)^n -1]/[i}
R = periodic payment
i = periodic interest rate
n = number of payments
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FV = (300)[(1+0.07)^5 -1]/[0.07]
FV = (300)[0.402551731/0.07
FV = $1725.22
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Cheers,
Stan H.