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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 ago
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