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20 votes
20 votes
find the future value of an ordinary annuity of $110 paid at the end of each quarter for five years if interest is earned at a rate of 6% compounded quarterly ....round to 2 decimal places

User Govind Malviya
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1 Answer

12 votes
12 votes

Given:

Amount paid is, p = $110.

Interest rate is, r = 6%=0.06.

Nmber of years, t = 5 years.

Number of times per year is, n = 3 (each quarter).

The objective is to find the future values compounded quarterly.

The general formula to find the compound interest is,


A=P(1+(r)/(n))^(n(t))

Substitute the given values in the above equation.


\begin{gathered} A=110(1+(0.06)/(3))^(3(5)) \\ A=110(1+0.02)^(15) \\ A=148.05 \end{gathered}

Hence, the future value is .

User Ahmed Ginani
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