+598 What payment at the end of each year for 18 years will amount to $16,000 at 4.2% compounded monthly?
Any help with steps would be greatly appreciated.
Thanks
What payment at the end of each year for 18 years will amount to $16,000 at 4.2% compounded monthly?
In this problem, first you have to convert the interest rate from compounded monthly to compounded ANNUALLY, because the payments required are annual payments. Therefore, the interest rate would be: 4.28%. Based on this rate, the annual payments required at the end of each year would be $607.92. The same formula as in the previous problem is used, except you have to solve for the regular payment, which is a DIRECT solution.
