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You plan to open a bank account by depositing $500 today and end of each year...

You plan to open a bank account by depositing $500 today and end of each year for the next nine years (year 1, year 2, ……. year 9). If the interest rate is 2%, what will be your balance in ten years? show workings in excel file

Solutions

Expert Solution

Present Value of annuity = PMT * ((1-(1+r)^(-n)) / r)

= 500 * ((1-(1+0.02)^(-10)) / 0.02)

= $4,491.29 (Approximately)

jeff jeffy answered 2 years ago
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