Answer:
future value = $49163.8
so required amount will be $491200 nearest $100
Step-by-step explanation:
given data
annual interest rate = 6 %
annuity = $300 per month
time period = 10 years
to find out
how much money will they have for the college expenses
solution
we know that effective rate will be
effective rate =
effective rate = 5 ×
number of payment = 12 × 10 = 120
so future value will be express as
future value = annuity × .........1
future value = 300 ×
future value = 300 × 163.8793
future value = $49163.8
so required amount will be $491200 nearest $100