Hi all! i a having trouble figurig out the math of this..
I have 30.000 on my savings account. It has an interest rate of 0.007 percent. Every month for a year I add 5000 to my savings account.
How much money will I have by the end of the year?
I feel rather stupid for not being able to figure out the formula for this.
I guess it is something like this, but there MUST be a simpler way to calculate this.
(30000*1,007)+5000(*1,007)+5000(*1,007)+5000(*1,007)+5000(*1,007)+5000(*1,007)+5000(*1,007)+5000(*1,007)+5000(*1,007)+5000(*1,007)+5000(*1,007)+5000(*1,007)+5000
+118608 Hi all! i a having trouble figurig out the math of this..
I have 30.000 on my savings account. It has an interest rate of 0.007 percent. Every month for a year I add 5000 to my savings account.
How much money will I have by the end of the year?
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How often is the interest added? If it is added monthly (which is never really the case) then the interest rate is probably 0.007/12 % per month
Plus I doubt that you mean 0.007%, I expect you mean 0.007 which is 0.7%
So let me assume that you get 0.7/12 % monthly. = 0.000583 repeater
I will also assume that the the $5000 is deposited at the END of every month, including the last month.
\(30000*(1+\frac{0.0007}{12})^{12}+5000[(1+\frac{0.0007}{12})^{11}+(1+\frac{0.0007}{12})^{10}+...(1+\frac{0.0007}{12})^{0}]\\ 30000*(1.0005833333)^{12}+5000[(1.0005833333)^{11}+(1.0005833333)^{10}+...(1.0005833333)^{0}]\\ 30000*(1.0005833333)^{12}+5000[(1.0005833333)^{11}+(1.0005833333)^{10}+...(1.0005833333)^{0}]\\\)
You can work out the bit in the squar brackets using the sum of a GP formula.
There are formula to do this but this is how they are derived.
