   Chapter 13.4, Problem 10E ### Algebra and Trigonometry (MindTap ...

4th Edition
James Stewart + 2 others
ISBN: 9781305071742

#### Solutions

Chapter
Section ### Algebra and Trigonometry (MindTap ...

4th Edition
James Stewart + 2 others
ISBN: 9781305071742
Textbook Problem

# APPLICATIONSSaving How much money should be invested monthly at 6 % per year, compounded monthly to have $2000 in 8 months? To determine To find: The amount of money that should be invested monthly at 6% per year, compounded monthly, to have$2000 in 8 months.

Explanation

Given:

The interest per year is,

i=6%

Period of payment is 8 months.

Total amount to be paid is \$2000.

Approach:

The amount Af of an annuity consisting of n regular equal payments of size R with interest rate i per time period is given by,

Af=R(1+i)n1i(1)

Calculation:

The interest per year compounded monthly is given by,

i=0.0612=0

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