Question

Determine the amount of the ordinaryannuity at the end of the given period(Round your final answer to two decimalplaces.)$600 deposited annually at 5.4% for 10 years

Answer 1

In this case, we'll have to carry out several steps to find the solution.

Step 01:

Data:

principal = $600

time (period) = 10 years

rate = 5.4% = 0.054

Step 02:

ordinary annuity:

FV = future value of ordinary annuity

p = 600

n = 10

i = 0.054

$FV\text{ =P}\cdot(\text{ }\frac{(1+i)^n-1}{i})$

$FV\text{ = 600}\cdot(\frac{(1+0.054)^{10}-1}{0.054})$

FV = 600 * 12.8152 = 7689.1378

The answer is:

FV = 7689.14