Question

In an attempt to have funds for a down payment in four years, James Dupont plans to save $3,950 a year for the next four years. With an interest rate of 5 percent, what amount will James have available for a down payment after the four years? Use Exhibit 1-B. (Round FVA factor to 3 decimal places and final answer to 2 decimal places.)

Answer 1

Answer:

21826,24

Explanation:

3950      

5%      

5 años    

     

3950 1,05 0 3950 1,00 3950

3950 1,05 1 3950 1,05 4147,5

3950 1,05 2 3950 1,10 4354,875

3950 1,05 3 3950 1,16 4572,61875

3950 1,05 4 3950 1,22 4801,249688

                     21826,24344

     

FVOrdinary Annuity​=C*(1+i)n-1/i      

     

FV 3950*(1,05)>n-1/0,05    

     

FV 3950*(1,27628156-1)/0,05  1,05 5 1,276281563

     

FV 21826,24324