ber 1, 2022, Eli opened an account with a deposit of $1000. Eli will continue to make $1000 deposits every month until September 1, 2030, when he will make his last deposit. How much will be in the account on Septemb

ber 1, 2022, Eli opened an account with a deposit of $1000. Eli will continue to make $1000 deposits every month until September 1, 2030, when he will make his last deposit. How much will be in the account on Septemb

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 36P

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Question

On September 1, 2022, Eli opened an account with a deposit of $1000. Eli will continue to make
$1000 deposits every month until September 1, 2030, when he will make his last deposit. How much
will be in the account on September 1, 2042 if the account earns 4% monthly?

Expert Solution

Step 1: Define=compounding

Due to the compounding of interest the effective interest is much larger and large amount of interest is accumulated.

Step by step

Solved in 3 steps with 1 images

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