a. Use the appropriate formula to determine the periodic deposit. b. How much of the financial goal comes from deposits and how much comes from interest? Periodic Deposit Rate $? at the end of every three 4.5% compounded quarterly months Click the icon to view some finance formulas. Time 6 years Financial Goal $30,000 a. The periodic deposit is $ (Do not round until the final answer. Then round up to the nearest dollar as needed.) b. $ of the $30,000 comes from deposits and $[ comes from interest. (Use the answer from part (a) to find these answers. Round to the nearest dollar as needed.)
a. Use the appropriate formula to determine the periodic deposit. b. How much of the financial goal comes from deposits and how much comes from interest? Periodic Deposit Rate $? at the end of every three 4.5% compounded quarterly months Click the icon to view some finance formulas. Time 6 years Financial Goal $30,000 a. The periodic deposit is $ (Do not round until the final answer. Then round up to the nearest dollar as needed.) b. $ of the $30,000 comes from deposits and $[ comes from interest. (Use the answer from part (a) to find these answers. Round to the nearest dollar as needed.)
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:a. Use the appropriate formula to determine the periodic deposit.
b. How much of the financial goal comes from deposits and how much comes from interest?
Periodic Deposit
Rate
$? at the end of every three 4.5% compounded quarterly
months
iClick the icon to view some finance formulas.
Time
6 years
Financial Goal
$30,000
a. The periodic deposit is $.
(Do not round until the final answer. Then round up to the nearest dollar as needed.)
b. $ of the $30,000 comes from deposits and $
comes from interest.
(Use the answer from part (a) to find these answers. Round to the nearest dollar as needed.)
Expert Solution
Introduction and Formula
Solution:-
When an equal amount is deposited each period at end of period, it is called ordinary annuity.
We know, future value of ordinary annuity = PMT x [(1+r)n – 1] / r
where, PMT = equal periodic payment saved each period
r = periodic interest rate
n = number of periods
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