ou set up a college fund in which you pay $5000 each year at the beginning of the year. How much money in \$) will you have accumulated in the fund after 21 years, if your fund earns 12\% compounded annually?
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Using the formula for the future value of an annuity: FV = P * ((1 + r)^n - 1) / r Where: FV = Future Value P = Payment per period ($5000) r = Interest rate per period (12% or 0.12) n = Number of periods (21 years) Plugging in the values: FV = $5000 * ((1 + Show more…
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