Q. 187 Myra just got her first full-tim... [FREE SOLUTION]

91影视

Intermediate Algebra

OPENSTAX

$Math Studyset 91影视 Explanations$ Math

OER 2017 Edition 路 1346 pages

ISBN: 9780998625720

Chapter 12: Q. 187 (page 1200)

Myra just got her first full-time job after graduating from college. She plans to get a master鈥檚 degree, and so is depositing $$ 2, 500$ a year from her year-end bonus into an annuity. The annuity pays $6.5 %$ per year and is compounded yearly. How much will she have saved in five years to pursue her master鈥檚 degree ?

Short Answer

Expert verified

Total amount saved by Myra will be equal to $$ 14, 234.1024$

Step by step solution

Step 1. Given information

Amount of $$ 2, 500$ is depositing per year into an annuity such that the annuity pays $6.5 %$ per year which is compounded yearly

Step 2. Find the amount Myra will save in five years to pursue her Master's degree.

Let $P, r, n, t$ denote amount deposited , rate of interest , the number of times deposit will be made and the interest compounded each year and number of years.

$P = $ 2, 500 r = 0.065 n = 1 t = 5$

So,

To find the Annuity formula, use the formula role="math" localid="1645508677670" $A_{t} = \frac{P (1 + {(\frac{r}{n})}^{n t} - 1)}{\frac{r}{n}}$

$\begin{matrix} A_{t} = 2500 (\frac{{(1 + \frac{0.065}{1})}^{5 (1)} 鈭� 1}{\frac{0.065}{1}}) \\ = 2500 (\frac{{(1.065)}^{5} 鈭� 1}{0.065}) \\ = \frac{2500 (0.370)}{0.065} \\ = $ 14, 234.1024 \end{matrix}$

Unlock Step-by-Step Solutions & Ace Your Exams!

Full Textbook Solutions
Get detailed explanations and key concepts
Unlimited Al creation
Al flashcards, explanations, exams and more...
Ads-free access
To over 500 millions flashcards
Money-back guarantee
We refund you if you fail your exam.

Over 30 million students worldwide already upgrade their learning with 91影视!

One App. One Place for Learning.

All the tools & learning materials you need for study success - in one app.

Get started for free

Recommended explanations on Math Textbooks

View all explanations

What do you think about this solution?

We value your feedback to improve our textbook solutions.

91影视

Short Answer

Step by step solution

Step 1. Given information

Step 2. Find the amount Myra will save in five years to pursue her Master's degree.

One App. One Place for Learning.

Most popular questions from this chapter

Recommended explanations on Math Textbooks

Applied Mathematics

Mechanics Maths

Probability and Statistics

Logic and Functions

Decision Maths

Statistics

Study anywhere. Anytime. Across all devices.