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Find the accumulated value of an annuity due of $300 payable at the beginning of every month for seven years at 6% compounded monthly.

A. $26,292.49
B. $27,505.28
C. $28,800.00
D. $29,484.00

User Senador
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1 Answer

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Final answer:

The accumulated value of the annuity due is approximately $29,484.00.

Step-by-step explanation:

To find the accumulated value of an annuity due, you can use the formula:

A = PMT x ((1+r)^n - 1) / r

Where:

A = accumulated value

PMT = payment amount per period

r = interest rate per period

n = number of periods

In this case, the payment amount per month is $300, the interest rate is 6% compounded monthly (or 0.06/12 = 0.005), and the number of periods is 7 years x 12 months = 84 months.

Plugging in these values into the formula, we get:

A = 300 x ((1+0.005)^84 - 1) / 0.005

Calculating this expression gives us an accumulated value of approximately $29,484.00.

User Rwfbc
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