You want to have $175,000 in your savings account 5 years from now. You’re prepared to...
You want to have $175,000 in your savings account 5 years from now. You’re prepared to make equal annual deposits at the end of each year. If the account pays 5.0% interest, what amount must you deposit each year?
Homework Answers
Future value of annuity=Annuity[(1+rate)^time period-1]/rate
175,000=Annuity[(1.05)^5-1]/0.05
175,000=Annuity*5.52563125
Annuity=175,000/5.52563125
=$31670.59(Approx).
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