Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. you deposit 400$ each month into an account earnin

you deposit 400$ each month into an account earning 2% interest compounded monthly. a) how much will you...

Free

50.1K

Verified Solution

Question

Finance

youdeposit 400$ each month into an account earning 2% interestcompounded monthly.

a) how much will you have
in the account in 35 years?

b) how much money will you put into the account?

c) how much total interest will you earn?

Answer & Explanation Solved by verified expert
3.8 Ratings (548 Votes)

a) $ 2,43,038
Working:
Future value of annuity of 1 = (((1+i)^n)-1)/i Where,
= (((1+0.001667)^420)-1)/0.001667 i 2%/12 = 0.001667
= 607.5950664 n 35*12 = 420
Future value of monthly deposit = Monthly deposit * Future value of annuity of 1
= $                 400 * 607.59507
= $       2,43,038
b) $ 1,68,000
Working:
Amount invested = Monthly deposit * Number of months
= $                 400 * 420
= $       1,68,000
c) $     75,038
Working:
Total interest earned = Future value of deposits - Total amount invested
= $       2,43,038 - $ 1,68,000
= $           75,038

Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Transcribed Image Text

youdeposit 400$ each month into an account earning 2% interestcompounded monthly.a) how much will you havein the account in 35 years?b) how much money will you put into the account?c) how much total interest will you earn?

Other questions asked by students

Finance
1.2K views

Complex finance problem using Excel Valuing Copperhead Corporation: Use the FCF valuation method with multiple growth rates...

Biology
1.2K views

How is much work time lost in suffering from bacterial meningitis?

Physics
1.2K views

A proton and an a particle are accelerated through a potential difference of 100 V...

Geometry
1.2K views

Find the value of x in the triangle X the following Classify the triangle in...

Basic Math
1.2K views

Find the regression line for the data points X 1 2 3 4 y 1...

Basic Math
1.2K views

K State the y intercept and slope of the graph of the equation y 9x...

Accounting
1.2K views

Question 4 (1 point) An increase in the income tax rate will increase the break-even...

Accounting
1.2K views

Exercise 10-25 Sandhill Co. issued $477,000, 6%, 30-year bonds on January 1, 2022, at 105....

Accounting
1.2K views

If a company is over budget in a performance report then an unfavorable budget variance...

Accounting
1.2K views

Keesha Co. toma prestados $200 000 en efectivo el 1 de noviembre del ao en...

Accounting
1.2K views

! Required information [The following information applies to the questions displayed below.] ...

Accounting
1.2K views

please answer! thank you The adjusted trial balance...