There is a 120 month annuity where the interest is 3 percent nominal. Deposits are at the end of the month. The first deposit is 100 dollars and each subsequent deposit is 5 dollars greater than the previous one. Calculate the present value.
Added by Noelia E.
Step 1
For the first deposit, PMT = 100, r = 0.03/12 (monthly interest rate), and n = 120. Plugging in the numbers, we get: FV1 = 100 x [(1 + 0.03/12)^120 - 1] / (0.03/12) = 14,038.77 For the second deposit, PMT = 105, r = 0.03/12, and n = 119 (one less period). Show more…
Show all steps
Close
Your feedback will help us improve your experience
Lucas Finney and 56 other Calculus 3 educators are ready to help you.
Ask a new question
Labs
Want to see this concept in action?
Explore this concept interactively to see how it behaves as you change inputs.
Key Concepts
Recommended Videos
Determine the value of the annuity for the indicated monthly deposit amount, the number of deposits, and the interest rate. Deposit amount: $\$ 50 ;$ total deposits: $60 ;$ interest rate: 5$\%$ , compounded monthly
Sequences, Probability and Counting Theory
Series and Their Notations
Determine the value of the annuity for the indicated monthly deposit amount, the number of deposits, and the interest rate. Deposit amount: $\$ 100 ;$ total deposits: $120 ;$ interest rate: 10$\%$ , compounded semi-annually
Narayan H.
Recommended Textbooks
Calculus: Early Transcendentals
Thomas Calculus
18,000,000+
Students on Numerade
Trusted by students at 8,000+ universities
Watch the video solution with this free unlock.
EMAIL
PASSWORD