Question

you are to make monthly deposits of $475 into a retirement account that pays an apr of 10.8 percent compounded monthly. if your first deposit will be made one month from now, how large will your retirement account be in 33 years? note: do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.

Answer 1

Answer:

The amount in the retirement account be in 33 years is  $139,356.44

Calculation of the amount:

Since the monthly deposit is $475. Here the monthly interest rate is 10.8% And the time period is 33 years

Now here we applied the formula of future value of annuity

So,

FVA = C{[(1 + r)^t− 1] / r}

= $475[{[1 + (10.8/12)]^360 – 1} / (10.8/12)]

= $139,356.44

hence, The amount in the retirement account be in 33 years is  $139,356.44

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