Question

How much money would have to be deposited per month (where the deposits will be made at the end of each month) at 6% interest compounded monthly to accumulate to $42,000 in 16 years.

Answer 1

Your'e equation is :
Interest = Principal × Rate × Time

where:
'Interest' is the total amount of interest paid,
'Principal' is the amount lent or borrowed,
'Rate' is the percentage of the principal charged as interest each year. The rate is expressed as a decimal fraction, so percentages must be divided by 100. For example, if the rate is 15%, then use 15/100 or 0.15 in the formula.
'Time' is the time in years of the loan.

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Answer 2

Is this right?

A=P(1+(r/n))^nt

42,000 = P(a+ (.06/12))^196

P = $16119.75

$16119.75/12 = 1343.31

Is $1343.31 correct?

Answer 3

I meant to write 1 not "a" in the question.

Answer 4

42000 =C(1+(.06/12)^ (12x16))
if you have a calculator - TI-83 you put 42000 into your y1 & the other side of the equation into your y2. & then find the intersecting points.

yes you're right except for the number above its supposed to be 16x12 = 192 not 196

Answer 5

Oh yes sorry about that typo.

Wait how come when I check $1343.31 it's not giving me $42,000?

Answer 6

I multiplied that with 16...
I'm doing it wrong probably...

Answer 7

your answer being :
16120.02
your calculator is going to say: x=16120.015 y=42000

Answer 8

do you have a TI-83 graphing calculator?

Answer 9

but isn't 16119.75 only for "Deposited now" and not "deposited per month"?

Answer 10

yes

Answer 11

did you get that answer? > 16119.75

Answer 12

If you want a FINAL amount you keep your initial amount. If you do not you subtract it.

Answer 13

Yea i didn't do it with the calculator though...I solved it using the formula because my teacher wants us to show work.

So the final answer would be 1-the pvalue?

Answer 14

If you're looking for your final amount, yes.