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"The Weimer Corporation wants to accumulate a sum of money to repay certain debts due on December 31, 2030. Weimer will make annual deposits of $150,000 into a special bank account at the end of each of
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31 votes
"The Weimer Corporation wants to accumulate a sum of money to repay certain debts due on December 31, 2030. Weimer will make annual deposits of $150,000 into a special bank account at the end of each of 10 years beginning December 31, 2021. Assuming that the bank account pays 6% interest compounded annually, what will be the fund balance after the last payment is made on December 31, 2030?"

User Mistika
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2.9k points

1 Answer

27 votes
27 votes

Answer:

FV= $1,873,697.4

Step-by-step explanation:

Giving the following formula:

Annual deposit= $150,000

Number of periods= 9 years compound periods (10 deposits)

Interest rate= 6%

To calculate the future value, we need to use the following formula:

FV= {A*[(1+i)^n-1]}/i

A= annual deposit

FV= {150,000*[(1.06^9) - 1]} / 0.06 + 150,000

FV= 1,723,697.4 + 150,000

FV= $1,873,697.4

User Saubhagya
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3.0k points
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