Question

Kelly Malone plans to have $51 withheld from her monthly paycheck and deposited in a savings account that earns 12% annually, compounded monthly. If Malone continues with her plan for one and one-half years, how much will be accumulated in the account on the date of the last deposit

Answer 1

$1,774.2

Step-by-step explanation:

Compute the accumulated amount in the account on the date of last deposit'

Formula used to find out the future value ordinary annuity is:

Future value factor of ordinary annuity
`(FVF-0A =_(n,i) ) = \frac{1-(1+i^)^ {n} }{i}`

1- oily Future value of ordinary annuity
`(FV-OA) = R (FVF-0A_(n,i) )`

Where:

R = annual return (ordinary annuity)

`(FVF-0A_(n,i) )` = future value of an ordinary annuity of I for n periods at i interest

Substituting the values:

Future value of ordinary annuity
`(FV-OA) = R (FVF-0A_(n,i) )`

=
`$50 (FVF-OA 12_{2.5X 12(12)/(12) } )`

=
`$50 X 34.7849`

`51 X 34.7849\\=1,774`