You deposit $1,500 into an account that pays 4% per year. Your plan is to withdraw...

You deposit $1,500 into an account that pays 4% per year. Your plan is to withdraw this amount at the end of 5 years to use for a down payment on a new car. How much will you be able to withdraw at the end of 5 years? Do not round intermediate calculations. Round your answer to the nearest cent.

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Expert Solution

Rate = 4%
N = 5
PV = 1500

Future value = PV * (1 + r)^n
= $1,500 * (1 + 4%)^5
= $1,500 * 1.216652902
= $1,824.98

The amount at the end of 5 years = $1,824.98

jeff jeffy answered 2 years ago

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