Answer:
Ans. you should deposit each month to end up with $38,000 the amount of $533.33 every month for 5 years at a APR of 6.5%
Step-by-step explanation:
Hi, first we have to convert all the data to monthly basis, that is, 5 years (5*12=60 months) and the rate of 6.5% APR offered by the bank (Monthly rate = 0.065/12=0,005666667 or 0.5667% monthly)
With that in mind, we need to solve for "A" the following equation.
Where:
FV = Future value of the car
r = rate of return offered by the bank
n = number of periods that you are going to make the monthly deposit
That is:
Best of luck.