Complete question is;
In 1986, a family member invested $100 each month into a savings account with an interest rate of 0.25% (that didn't change). In 2016, you decided you needed to use that saved up money for a big purchase, so you cash the savings account out.
How much money should be in the account using the FV formula?
Answer:
FV = $107.78
Explanation:
We are given;
Present value; PV = 100
Interest rate; r = 0.25% = 0.0025
We are told the PV was in 1986 and In 2016 you decided you needed to use that saved up money .
This is a period of 30 years.
Thus, the number of compounding periods is n = 30
Formula for FV is;
FV = PV(1 + r)ⁿ
FV = 100(1 + 0.0025)^(30)
FV = $107.78