You're prepared to make monthly payments of $220, beginning at the end of this month into an account that pays 8 percent interest compounded monthly. How many payments will you have made when your account balance reaches $59,000 (Do not round intermediate calculations and round your answer to 2 decimal place! e.g., 32.16.)
You're prepared to make monthly payments of $220, beginning at the end of this month into an account that pays 8 percent interest compounded monthly. How many payments will you have made when your account balance reaches $59,000 (Do not round intermediate calculations and round your answer to 2 decimal place! e.g., 32.16.)
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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Question
You're prepared to make monthly payments of $220, beginning at the end of this month
into an account that pays 8 percent interest compounded monthly.
How many payments will you have made when your account balance reaches $59,000
(Do not round intermediate calculations and round your answer to 2 decimal place!
e.g., 32.16.)
Expert Solution
Step 1
The concept of the time value of money states that the current worth of money is more than its value in the future.
Future value is the worth of money after a particular time span.
The future value of an annuity refers to the value of some predefined amount paid at regular intervals for a fixed period at a particular interest rate.
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