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Suppose you put $800 per month into a Roth IRA, that pays 8% APR (compounded monthly). Assume you have nothing saved today, calculate the future value of the retirement account 30 years from today. (Enter a positive value and round to 2 decimals)

User Czadam
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2 Answers

3 votes

Answer:

$1192288

Step-by-step explanation:

See attached file

User Mmirate
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6 votes

Answer:

Future Value = $1,192,287.56

Step-by-step explanation:

The future value is the expected total sum that an investment is suppose to accumulate together with interest over a period of time at a particular interest rate.

Where compounding is done done monthly, he future value is determined as follows:

FV = PV ×( (1+r)^n -1 )/ r

FV - Future Value , PV - present value r- monthly rate of interest , n- number of months

FV - ?

r- 8%/12 = 0.66%

n - 30× 12 =

PV - 800

FV = 800 × ( (1.00666)^(360) - 1 )/ 00666

= 800 × 1490.359449

= $1,192,287.56

User MrCartoonology
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