contestada

Suppose you invest $75 a month in an annuity that earns 48% APR compounded monthly. How much money will you have in this account after 3 years? 

Respuesta :

Answer:

The money after 3 years is $5819.8735

Step-by-step explanation:

We are given

monthly payment =$75

so, P=75

annuity that earns 48% APR

so, r=48%

Since, it is compounded monthly

so,

[tex]i=\frac{48}{12} =4[/tex]%

i=0.04

[tex]n=12\times 3=36[/tex]

now, we can use annuity formula

[tex]FV=P[\frac{(1+i)^n-1}{i} ][/tex]

where

FV is future value

now, we can plug values

[tex]FV=75[\frac{(1+0.04)^{36}-1}{0.04} ][/tex]

we get

[tex]FV=5819.8735[/tex]

The money after 3 years is $5819.8735