Formula for Sum

Question

To save money for a sabbatical to earn a​ master's degree, Henry deposits ​$2100 at the end of each year in an annuity that pays ​%6.5 compounded annually. Use the formula for the value of an​ annuity, shown to the right.

a. How much will he have saved at the end of 6 ​years?

b. Find the interest.

Answer 1

Here's the formula: fv=P(1+int/c)^(nt).

future value

principal

int

compound

yrs

times/yr

fv=2100(1+.065)^(1)=2236.50=1 yr

yr#2+2100=4336.5; +int=4618.37

3 " " 6783.72 " =7155.07

4 " " 9255.07 " =9856.65

5 " " 11956.64 " =14970.33

6 " " 17070.33 " = $18179.90

int=