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# present value in investments

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Janine is 21 years old. She opens an account that pays 1.25% interest, compounded monthly. She sets a goal of saving \$10,000 by the time she is 24 years old. How much must she deposit each month?

Sep 11, 2023

#1
+37045
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If she deposits at the beginning of the month, this becomes and ANNUITY DUE calculation...here is the formula :

Pluggin' in the numbers    FV = \$ 10 000

i = decimal interest per period  = .0125/ 12 months

n = number of periods = 3 x 12 = 36 months  ( when she is 24)

then solving for "C"       results in   C = \$ 272.46  per month

Sep 11, 2023

#1
+37045
+1

If she deposits at the beginning of the month, this becomes and ANNUITY DUE calculation...here is the formula :

Pluggin' in the numbers    FV = \$ 10 000

i = decimal interest per period  = .0125/ 12 months

n = number of periods = 3 x 12 = 36 months  ( when she is 24)

then solving for "C"       results in   C = \$ 272.46  per month

ElectricPavlov Sep 11, 2023