Question

You are planning to make monthly deposits of $300 into a retirement account that pays 8 percent interest compounded monthly. If your first deposit will be made one month from now, how large will your retirement account be in 25 years?

Answer 1

The correct answer is $285.308.1

Step-by-step explanation:

According to the scenario, computation of the given data are as follows:

Monthly payment (Pmt) = $300

Interest rate = 8%

Interest rate (monthly) (rate) = 8% ÷ 12 = 0.666667%

Time period = 25 years

Time period (monthly) (Nper) = 25 × 12 = 300

So, we can calculate the Future value by using Financial calculator.

The attachment is attached below:

Future value = $285,308.1