Question

Veronica deposits $60 each week into an account that pays 3.05% interest compounded weekly for 15 years. How much will she have at the end of 15 years.

Answer 1

Answer:

$59,321.62

Step-by-step explanation:

I'm going to assume that the 3.05% is a nominal rate

I'm also going to assume that there are 52 weeks in a year

To solve this equation we are going to use an annuity immediate and find the future value of these cash flows

We first need to find our new, effective interest rate which i will find by dividign .0305/52= .0006

If you don't have a financial calculator you will find the accumulated value of an annuity immediate through the following equation

$\frac{(1+i)^n-1}{i}$*pmt

Plug in our values to get

$60(\frac{(1+.0006)^{780}-1}{.0006})$

Compute this and get about $59,321.62

if you have any questions lmk