Question

alfred invest $60 a month in annuity that earns 4% ApR and is compounded monthly .what is the future value of alfreds accoint in five years​

Answer 1

Answer:

Step-by-step explanation:

Answer 2

Answer:

$934.30

Step-by-step explanation:

We have been given that Alfred invest $60 a month in annuity that earns 4% APR and is compounded monthly. We are asked to find the future value of Alfred's account after 5 years.

$FV=C_0\cdot (1+r)^n$, where,

$C_0=\text{Initial value}$,

$r=\text{APR in decimal form}$,

$n=\text{Number of times interest is compounded per year}$.

$r=4\%=\frac{4}{100}=0.04$

$FV=\ 60\cdot (1+0.04)^{12*5}$

$FV=\ 60\cdot (1.04)^{70}$

$FV=\ 60\cdot 15.57161835$

$FV=\ 934.2971$

$FV\approx \ 934.30$

Therefore, the future value of Alfred's account in 5 years would be $934.30.