Gary and Debra Garfield invested $7,400 in a savings account paying 8% annual interest when their...

Gary and Debra Garfield invested $7,400 in a savings account paying 8% annual interest when their daughter, Angela, was born. They also deposited $1,000 on each of her birthdays until she was 18 (including her 18th birthday).

Expert Solution

Step 1 :	Future value of $7400
	FV= PV*(1+r)^n

	Where,
	FV= Future Value
	PV = Present Value
	r = Interest rate
	n= periods in number

	= $7400*( 1+0.08)^18

	=7400*3.99602

	= $29570.54

Step 2 :	Future value of annuity

	Future Value of an Ordinary Annuity
	= C*[(1+i)^n-1]/i

	Where,
	C= Cash Flow per period
	i = interest rate per period
	n=number of period

	= $1000[ (1+0.08)^18 -1] /0.08

	= $1000[ (1.08)^18 -1] /0.08

	= $1000[ (3.996 -1] /0.08]

	= $37,450.24


Step 3 :	Total Value

	=$29570.54+37450.24
	=$67020.78

ekkarill92 answered 1 year ago

Brief Exercise A-5 Andrew and Emma Garfield invested $6,000 in a savings account paying 4% annual...

Brief Exercise A-5 Andrew and Emma Garfield invested $6,000 in a savings account paying 4% annual interest when their daughter, Angela, was born. They also deposited $1,000 on each of her birthdays until she was 18 (including her 18th birthday). Click here to view the factor table. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) How much was in the savings account on her 18th birthday (after the last deposit)? (Round answer to 2...

Jason and Sarah Allen invested $7,200 in a savings account paying 6% annual interest when their...

Jason and Sarah Allen invested $7,200 in a savings account paying 6% annual interest when their daughter, Angela, was born. They also deposited $1,100 on each of her birthdays until she was 16 (including her 16th birthday). Click here to view the factor table 1. Table 2 Table 3 Table 4 How much was in the savings account on her 16th birthday (after the last deposit)? (For calculation purposes, use 5 decimal places as displayed in the factor table provided,...

You invested money in a savings account paying 10% interest seven years ago.

You invested money in a savings account paying 10% interest seven years ago. The account is now worth $5,527.50. How much did you invest?

If you invest $7,000 into a savings account at an annual interest rate of 8% (APR),...

If you invest $7,000 into a savings account at an annual interest rate of 8% (APR), compounded semi-annually, how much will you have in the savings account after 11 years? Enter your response below (rounded to 2 decimal places).

A principal of $5500 is invested in an account paying an annual rate of 4%....

A principal of $5500 is invested in an account paying an annual rate of 4%. Find the amount in the account after 6 years if the account is compounded semiannually, quarterly, and monthly. (a) The amount in the account after 6 years if the account is compounded semiannually is $

Please use excel If you deposit $5,000 in a savings account that pays 8% annual interest...

Please use excel If you deposit $5,000 in a savings account that pays 8% annual interest compounded monthly, and make no other deposits to the account, how much will you have after 5 years? $7,449.23 In addition to the $5,000 as specified in the above problem, how much will you have at the end of 5 years if you also deposit an additional $200 at the end of each month for the entire 5 year period? In addition to the...

You have invested money in a savings account that pays a fixed monthly interest on the...

You have invested money in a savings account that pays a fixed monthly interest on the account balance. The following table shows the account balance over the first 5 months. Time in months Savings balance 0 $1500.00 1 $1521.00 2 $1542.29 3 $1563.88 4 $1585.77 5 $1607.97 (a) How much money was originally invested? $ (b) Show that the data are exponential. (Round your answer to three decimal places.) Each successive ratio of new/old is , which shows that the data...

Kyle invested $15,000 in a savings account. If the interest rate is 5% per year, how...

Kyle invested $15,000 in a savings account. If the interest rate is 5% per year, how much will be in the account in 10 years for monthly compounding? Round your answer to the nearest cent. Do NOT round until you calculate the final answer Provide your answer below:

Determine how much $1,000 deposited in a savings account paying 8% (compounded annually) will be worth...

Determine how much $1,000 deposited in a savings account paying 8% (compounded annually) will be worth after 5 years. how would you insert this in a financial calculator? confused on how to input (FVIF .08,5)

Suppose Evan deposited $10,000 into a savings account today. The account pays a nominal annual interest...

Suppose Evan deposited $10,000 into a savings account today. The account pays a nominal annual interest rate of 12%, but interest is compounded quarterly. Assuming that he makes no additional deposits into or withdrawals from the account, what will his ending balance be 10 years from today?

Question