Question

Find the future value of the ordinary annuity. $110 monthly payment, 5.75% interest, 2 years.

Answer 1

`\bf \qquad \qquad \textit{Future Value of an ordinary annuity}\\ \left. \qquad \qquad \right. (\textit{payments at the end of the period}) \\\\ A=pymnt\left[ \cfrac{\left( 1+(r)/(n) \right)^(nt)-1}{(r)/(n)} \right]`


`\bf \begin{cases} A= \begin{array}{llll} \textit{accumulated amount}\\ \end{array}\\ pymnt=\textit{periodic payments}\to &110\\ r=rate\to 5.75\%\to (5.75)/(100)\to &0.0575\\ n= \begin{array}{llll} \textit{times it compounds per year}\\ \textit{payments are monthly, thus} \end{array}\to &12\\ t=years\to &2 \end{cases} \\\\\\ A=110\left[ \cfrac{\left( 1+(0.0575)/(12) \right)^(12\cdot 2)-1}{(0.0575)/(12)} \right]`