Question
In: Finance
Monthly payments of ?$75 are paid into an annuity beginning on January? 31, with a yearly...
Monthly payments of ?$75 are paid into an annuity beginning on
January? 31, with a yearly interest rate of 12?%, compounded
monthly. Add the future values of each payment to calculate the
total value of the annuity on September 1.
On September? 1, the value of the annuity will be:
?(Round to the nearest? cent.)
Solutions
Expert Solution
| Calculation of value of annuity as on September? 1 | |||||
| Month | Period | Amount | Future value factor @ 1% | Future value | |
| A | B | C | D | C*D | |
| Jan | 0 | $75.00 | 1.07214 | $80.41 | |
| Feb | 1 | $75.00 | 1.06152 | $79.61 | |
| Mar | 2 | $75.00 | 1.05101 | $78.83 | |
| April | 3 | $75.00 | 1.04060 | $78.05 | |
| May | 4 | $75.00 | 1.03030 | $77.27 | |
| June | 5 | $75.00 | 1.02010 | $76.51 | |
| July | 6 | $75.00 | 1.01000 | $75.75 | |
| Aug | 7 | $75.00 | 1.00000 | $75.00 | |
| On September? 1, the value of the annuity will be: | $621.43 | ||||
jeff jeffy answered 2 years agoRelated Solutions
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