In: Finance
You are planning to make monthly deposits of $120 into a retirement account that pays 9 percent annual interest (APR), compounded monthly. If your first deposit will be made one month from now, how large will your retirement account be in 19 years? |
rev: 09_17_2012
Multiple Choice
$71,900.73
$75,495.77
$66,266.58
$68,305.69
$862,808.76
PMT = $120
Rate = 9% / 12 = 0.75%
Nper = 19 * 12 = 228
PV = 0
Future value can be calculated by using the following excel
formula:
=FV(rate,nper,pmt,pv)
=FV(0.75%,228,-120,0)
= $71,900.73
Amount at the end of 19 years = $71,900.73