Given:
• Amount to save, A = $28,000
,• Time, t = 6 years
,• Interest rate, r = 5.3% ==> 0.053
,• Number of times compounded = quarterly = 4 times
Let's find the amount that must be deposited into the account quarterly.
Apply the formula:
Where:
FV is the future value = $28,000
r = 0.053
n = 4
t = 6 years
Thus, we have:
Let's solve for P.
We have:
Solving further:
Divide both sides by 28.0384237:
Therefore, the amount that must be deposited quarterly into the account is $998.60
ANSWER:
$998.60