For the last 12 years, you deposited a certain amount of money each week into a...

For the last 12 years, you deposited a certain amount of money each week into a bank account whose annual rate is 1.9% with weekly compounding. If the account has $74,665 today, how much interest has the account earned?

Expert Solution

Step-1:Calculation of weekly deposit

Weekly deposit	=	Future value of weekly deposit	/	Future value of annuity of 1
	=	$ 74,665	/	700.7219
	=	$ 106.55

Working:

Future value of annuity of 1	=	(((1+i)^n)-1)/i		Where,
	=	700.721945		i	=	1.9%/52	=	0.000365
				n	=	12*52	=	624

Step-2:Calculation of interest earned

Future value of deposit					=	$ 74,665
Total deposit	=	$ 106.55	*	624	=	$ 66,490

Interest earned						$ 8,175

jeff jeffy answered 6 months ago

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