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HARMATHAP12 6.3.005.
Find the future value of an annuity of $1300 paid at the end of each year for 10 years, if interest is earned at a rate of 5%, compounded annually. (Round your answer to the
nearest cent.)
$
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Answer 1

We can use the formula for the future value of an ordinary annuity:

FV = P * ((1 + r)^n - 1) / r

where:
- FV is the future value of the annuity
- P is the periodic payment (in this case, $1300)
- r is the interest rate per period (in this case, 5% per year, compounded annually)
- n is the total number of periods (in this case, 10 years)

Plugging in the values, we get:

FV = 1300 * ((1 + 0.05)^10 - 1) / 0.05

Using a calculator, we get:

FV ≈ $16,524.12

Therefore, the future value of the annuity is approximately $16,524.12.