You're prepared to make monthly payments of $220, beginning at the end of this month into an account that pays 8 percent interest compounded monthly. How many payments will you have made when your account balance reaches $59,000 (Do not round intermediate calculations and round your answer to 2 decimal place! e.g., 32.16.)
You're prepared to make monthly payments of $220, beginning at the end of this month into an account that pays 8 percent interest compounded monthly. How many payments will you have made when your account balance reaches $59,000 (Do not round intermediate calculations and round your answer to 2 decimal place! e.g., 32.16.)
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
ChapterA3: Time Value Of Money
Section: Chapter Questions
Problem 3CE
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Question
You're prepared to make monthly payments of $220, beginning at the end of this month
into an account that pays 8 percent interest compounded monthly.
How many payments will you have made when your account balance reaches $59,000
(Do not round intermediate calculations and round your answer to 2 decimal place!
e.g., 32.16.)
Expert Solution
Step 1
The concept of the time value of money states that the current worth of money is more than its value in the future.
Future value is the worth of money after a particular time span.
The future value of an annuity refers to the value of some predefined amount paid at regular intervals for a fixed period at a particular interest rate.
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