Question 1194508
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1 year = 12 months
3.5*1 year = 3.5*12 months
3.5 years = 42 months


We want the future value to be $1,801 and have it occur at the 42 month mark.
The annual interest rate in decimal form is r = 0.08


Divide by 12 to get the monthly version: r/12 = 0.08/12 = 0.00666666666667
which is approximate.


The future value annuity formula to use is this
FV = P*( (1+i)^n - 1)/i
This is an ordinary annuity and not "annuity due".
This is because the deposits happen at the end of each month, rather at the beginning.


In this case,
FV = future value = 1801
P = unknown monthly deposit
i = 0.00666666666667 approximately
n = 42 months


Let's solve for P
FV = P*( (1+i)^n - 1)/i
1801 = P*( (1+0.00666666666667)^42 - 1)/0.00666666666667
1801 = P*48.2851385181578
P = 1801/48.2851385181578
P = 37.2992613311594
P = 37.30


Answer: <font color=red>$37.30</font>
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