- #1
pbonnie
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Homework Statement
(attached)
Homework Equations
Sn = (a(1-r^n))/(1-r)
The Attempt at a Solution
This was my attempt, but I think I've done this wrong. I'm not really sure how to account for the fact that the payments are made at the end of the year. Unless that means I would act as if it were a 19 year investment?
n = 20 a = 2000 r = 8.5%/4 = 0.085/4 = 0.02125 Sn = (a(1-r^n))/(1-r)
S20 = (2000(1-〖(1+0.02125)〗^20))/(1-(1+0.02125)) S20 = 49 204.22
The final amount would be $49 204.22