Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Annuity is a sequence of equal periodic payments .One type of annuity is a large amount of money deposited into a bank account and then

Annuity is a sequence of equal periodic payments .One type of annuity is a large amount of money deposited into a bank account and then a fixed amount is withdrawn each month

Suppose you deposit $1000 into the account paying 3.6% compounded monthly ,and then withdraw $600 at the end of each month . the monthly interest rate will be .036/12 or .003, and the balance in the account at the end of each month will be computed as:


[balance at the end of the month] = (1.003) * [balance at end of previous month] - 600 


After how many months will the account contain less than $600, and what will be the amount at that time?

Step by Step Solution

3.41 Rating (154 Votes )

There are 3 Steps involved in it

Step: 1

Given Principal amount deposited 1000 Interest rate p... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Contemporary Business Mathematics with Canadian Applications

Authors: S. A. Hummelbrunner, Kelly Halliday, Ali R. Hassanlou, K. Suzanne Coombs

11th edition

134141083, 978-0134141084

More Books

Students also viewed these Accounting questions

Question

Write a Python program to check an input number is prime or not.

Answered: 1 week ago

Question

3. In what way are fish movements impaired in cold water?

Answered: 1 week ago