Find the future value of an ordinary annuity of $50 paid quarterly for 5 years, if the interest rate is 6%, compounded quarterly

Question

3 years ago

5

. (Round your answer to the nearest cent.)

1 answer:

vovikov84 [41] · Answer 1 · 2022-07-02T16:30:34+03:00

<h3>Answer:</h3>

$1156.18

<h3>Step-by-step explanation:</h3>

The future value (FV) is given from the payment (P), the interest rate (r) and the number of years (t) by ...

... FV = P·((1 +r/4)^(4t) -1)/(r/4)

... = (50)·(1 +.06/4)^(4·5) -1)/(.06/4)

... = 50·(1.015^20 -1)/.015 ≈ 1156.18

The future value is $1156.18.