Question
In: Economics
John starts a savings account by depositing $1,000 today and thenincreases the deposit by $50...
John starts a savings account by depositing $1,000 today and then increases the deposit by $50 each year until Year 20. If the bank pays an interest of 12% per year compounded yearly, what is the account balance at the end of 25 years?
Solutions
Expert Solution
we had the initial deposit of
$1000 and we increased the deposit by $50 each year for 20
years
so for the first 20 years we had calculated the based on simple interest ( P*R*T / 100)for each year and then the amount after 20 years is $13284.94
Balance after 5 years is calculated on the basis of compound interest P*(1+r/100)^n so the total amount is $23381.49 (approx)
Rahul Sunny answered 2 years agoRelated Solutions
You start a savings account today by depositing $1,000 in an account. Each year you add...
You start a savings account today by
depositing $1,000 in an account. Each year you add 3% to the amount
you deposited in the previous year. You do this for 20 years (21
total payments including the payment today.) The interest rate is
6%. How much will you have in the bank at the end of year 20.
10 years ago, John opened a savings account with the Citizens Bank by depositing $10,000. The...
10 years ago, John opened a
savings account with the Citizens Bank by depositing $10,000. The
account pays 5% simple interest. 5 years after his first deposit,
he made another deposit of $5,000. What will be the total amount in
the account 5 years from now?
Today, you open a new savings account and plan to begin depositing equal amounts at the...
Today, you open a new savings account and plan to begin
depositing equal amounts at the beginning of each year for 5 years,
including the deposit you make today. There will be only these 5
deposits and no withdrawals made to your account. Assume the
interest rate you will earn is 8%. If you want your account balance
to be exactly $40,000 at the end of 5 years, what must be the
amount of each deposit?
Today, you open a new savings account and plan to begin depositing equal amounts at the...
Today, you open a new savings account and plan to begin
depositing equal amounts at the beginning of each year for 10
years, including the deposit you make today. There will only be
these 10 deposits and no withdrawals. Assume the interest rate you
will earn is 3%. If you want your account balance to be exactly
$15,000 at the end of 10 years, what must be the amount of each
deposit?
Today, you open a new savings account and plan to begin depositing equal amounts at the...
Today, you open a new savings account and plan to begin
depositing equal amounts at the beginning of each year for 9 years,
including the deposit you make today. There will only be these 9
deposits and no withdrawals. Assume the interest rate you will earn
is 4%. If you want your account balance to be exactly $20,000 at
the end of 9 years, what must be the amount of each deposit?
Suppose that you deposit $1,000 in a savings account at Wells Fargo and plan to leave...
Suppose that you deposit $1,000 in a savings account at Wells
Fargo and plan to leave your principal and any interest in the
account for four months. The interest rate in the first month is
2%; in the second month, 2%; in the third month, 1%; and in the
fourth month, 2%. What is the future value of your account at the
end of the holding period? Do not round at intermediate steps in
your calculation. Round your final answer...
Suppose you have a savings account earning 4.8% APR. you deposit $50 in the account at...
Suppose you have a savings account earning 4.8% APR. you deposit
$50 in the account at the end of each week. What is the balance
after 4 years
Anton will deposit $1,000 into a savings account at the beginning of each month for the next 10 years.
Anton will deposit $1,000 into a savings account at the
beginning of each month for the next 10 years. In return, he
receives a payment of X at the end of each year forever, beginning
at the end of the 11th year. Assuming an annual effective rate of
discount of 5% for both accounts, determine X.
Today, you open a new savings account and deposit $3,000. No other deposits or withdrawals are...
Today, you open a new savings account and deposit $3,000. No
other deposits or withdrawals are made to your account. Assume you
will earn 4% simple interest per year. How much will your
investment be worth in 25 years?
Today, you open a new savings account and deposit $3,000. No other deposits or withdrawals are...
Today, you open a new savings account and deposit $3,000. No
other deposits or withdrawals are made to your account. Assume you
will earn 4% simple interest per year. How much will your
investment be worth in 25 years
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- A conductive sphere with radius ? = 1 ? has been increased to the potential ?0...
- Define a char variable. Read a char value from the keyboard into the variable. Print the...
- If you wanted to store a birthday within code, what class would you use in Java?...
- Explain what is meant by the Theme Park internal and external business environment and use the...
- Description Write a program that prints out your name, the course ID of this class, what...
- A project has an initial cost of $65,475, expected net cash inflows of $12,000 per year...
- Make a program that lets the user enter a positive or negative integer as many times...
ADVERTISEMENT