Question

4. If you deposit $3,000 at the end of each of the next 20 years into an account paying 10.5% interest, how much money will you have in the account in 20 years

Answer 1

$24498.5

Step-by-step explanation:

A = Pe^rt ..... 1

Where :

A is the future value

P is the principal

r is the interest rate

t is the time

Given

P = $3,000

r = 10.5% = 0.105

time = 20years

Substitute the above values into equation 1

A = Pe^rt

A = $3,000e^0.105×20

A = 3000e^2.1

A = $24498.5097

A = $24498.5

At the end of the 20th year, he must have accumulated the sum of $24498.5