Explanation Given information: Christine contributes $ 100 each month to her 401 ( k ) and the per annum rate of return is assumed to be 8 % compounded monthly. Formula used: Theorem Amount of an Annuity: Suppose that P is the deposit in dollars made at the end of each payment period for an annuity paying i percent interest per payment period. The amount A of the annuity after n deposits is A = P ( 1 + i ) n − 1 i Calculation: Christine contributes $ 100 each month to her 401 ( k ) so P = $ 100 Per annum rate of return is 8 % Per month rate of return is 8 % 12 = 0

11th Edition

ISBN: 9780135228982

Author: Sullivan

Publisher: PEARSON

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Chapter 12.3, Problem 89AYU

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To calculate: The value of Christine’s 401(k) after the 360th deposit (30 years), if Christine contributes $100 each month to her 401(k) and the per annum rate of return is assumed to be 8% compounded monthly.

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Chapter 12.3, Problem 88AYU

Chapter 12.3, Problem 90AYU

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The value of Christine’s 401 ( k ) after the 360 t h deposit ( 30 years), if Christine contributes $ 100 each month to her 401 ( k ) and the per annum rate of return is assumed to be 8 % compounded monthly.