Use Table 12-1 of your text to find the future value of $1,300 deposited at the BEGINNING of every three months, for 3 years if the bank pays 12% interest, compounded quarterly.
A) $18,789.65
B) $19,955.20
C) $19,003.13
D) $20,830.22

Question

Quizplus · Accepted Answer

This is an annuity due problem because deposits are made at the beginning of each period. To find the future value of an annuity due, you can use the future value annuity due formula or a financial calculator. Given the interest rate is 12% compounded quarterly, and the deposits are made quarterly for 3 years (12 periods), the future value can be calculated accordingly. The correct future value from the options provided that matches the calculation for these parameters is $19,003.13.

Use Table 12-1 of Your Text to Find the Future