Question
How much will be accumulated in a fund, earning 6% yearly interest, at the end of 4 years if 700$ is deposited at the beginning
How much will be accumulated in a fund, earning 6% yearly interest, at the end of 4 years if 700$ is deposited at the beginning of each year for the 4 years?
our prof is suggesting we use the equasion F(future)= A*(((1+i)^n-1)-1) / i
where A =750 and i = .06 and n(compound period)=4 however looking at this equasion if n=1 then the equasion is now F=A and if you have $750 in the bank for a year you earn the interest on it, so this equasion seems wrong to me, every answer you get needs to be multiplied by an extra (1+i) if you are counting n as compound periods or years having intrest collected on the money. am i right???!
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started