Question 1193611
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If money is worth 6% compounded quarterly, how much must Stef
{{{highlight(cross(save))}}} <U>deposit</U> at the end of every three months in order to have ₱48,000 in 3 years ?
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<pre>

It is about a classic Ordinary Annuity saving plan. The general formula is 


    FV = {{{P*(((1+r)^n-1)/r)}}},    


where  FV is the future value of the account;  P is the quarterly payment (deposit); 
       r is the factual quarterly rate presented as a decimal; 
       n is the number of deposits (= the number of years multiplied by 4, in this case).


From this formula, you get for the quarterly payment 


    P = {{{FV*(r/((1+r)^n-1))}}}.     (1)


Under the given conditions, FV = P48,000;  r = 0.06/4;  n = 3*4.  So, according to the formula (1), 
you get for the quarterly payment 


    P = {{{48000*(((0.06/4))/((1+0.06/4)^(3*4)-1)))}}} = P3680.64.


<U>Answer</U>.  The necessary quarterly deposit value is P3680.64.
</pre>

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On Ordinary Annuity saving plans, &nbsp;see the lessons

&nbsp;&nbsp;&nbsp;&nbsp;- <A HREF=http://www.algebra.com/algebra/homework/Sequences-and-series/Ordinary-Annuity-saving-plans-and-geometric-progressions.lesson>Ordinary Annuity saving plans and geometric progressions</A>

&nbsp;&nbsp;&nbsp;&nbsp;- <A HREF=https://www.algebra.com/algebra/homework/Sequences-and-series/Solved-problem-on-Ordinary-Annuity-saving-plans.lesson>Solved problems on Ordinary Annuity saving plans</A>

in this site.


The lessons contain &nbsp;EVERYTHING &nbsp;you need to know about this subject, &nbsp;in clear and compact form.


When you learn from these lessons, &nbsp;you will be able to do similar calculations in semi-automatic mode.