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CaHeK987 [17]
3 years ago
9

You want to quit your job and return to school for an MBA degree 3 years from now, and you plan to save $5,000 per year, beginni

ng immediately. You will make 3 deposits in an account that pays 5.2% interest. Under these assumptions, how much will you have 3 years from today? a. $17,943.97 b. $18,442.41 c. $14,953.30 d. $17,445.52 e. $16,614.78
Business
1 answer:
dexar [7]3 years ago
6 0

Answer: $16,614.78

Explanation:

As you are making a constant deposit every year beginning immediately, this is an Annuity due.

The value in 3 years will be:

= Amount deposited * (1 + i)  * (( 1 + i) ^n - 1) / i

= 5,000 * (1 + 5.2%)  * (( 1 + 5.2%)³ - 1) / 5.2%

= $‭16,614.78304‬

= $16,614.78

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