What amount would you have if you deposited $10900 a year for 8 years at 3 perce

Question

What amount would you have if you deposited $10900 a year for 8 years at 3 percent (compounded annually)?

Use the appropriate Time Value of Money table [Exhibit 1-A, Exhibit 1-B, Exhibit 1-C, OR Exhibit 1-D

1-A

http://lectures.mhhe.com/connect/0073382426/Chapter%201/exhibit_1-a.jpg

1-B

http://lectures.mhhe.com/connect/0073382426/Chapter%201/exhibit_1-b.jpg

1-C

http://lectures.mhhe.com/connect/0073382426/Chapter%201/exhibit_1-c.jpg

1-D

http://lectures.mhhe.com/connect/0073382426/Chapter%201/exhibit_1-d.jpg

Explanation / Answer

Future value of annuity = P×[(1+r)^n-1]÷r

r is interest rate

P is payment per period

n is number of payments

= $10,900×[(1+3%)^8-1]÷3%

= $96,926.46

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