Question
Asked Oct 10, 2019

Find the amount (future value) of the ordinary annuity. (Round your answer to the nearest cent.)

$550/month for 16 years at 7%/year compounded monthly
check_circleExpert Solution
Step 1

We know that,

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Step 2

Given,

PMT $550/month
r 0.07
t 16 years
т %3D 12
(as payment is done per month)
0.07
r
so, i=
т
0.005833
12
and, n = t Xm = 16 x 12 = 192
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PMT $550/month r 0.07 t 16 years т %3D 12 (as payment is done per month) 0.07 r so, i= т 0.005833 12 and, n = t Xm = 16 x 12 = 192

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Step 3

We will substitute the above obtained va...

FV PMT ti)n - 1
i
550 (1+0.005833)192 _ 1
0.005833
550 x 352.2681121
=$193747.4616
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FV PMT ti)n - 1 i 550 (1+0.005833)192 _ 1 0.005833 550 x 352.2681121 =$193747.4616

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