Find the amount of an annuity that consists of $30$ annual payments of $\$ 500$
Each into an account that pays $7 \%$
Interest per year
A) $\$ 7,230.09$
B) $\$ 17,230.49$
C) $\$ 47,230.39$
D) $\$ 15,000$
E) $\$ 37,430.59$

Question

Quizplus · Accepted Answer

We can use the formula for the present value of an annuity:

$$PV = PMT \cdot \frac{1 - (1+r)^{-n}}{r}$$

where PV is the present value, PMT is the payment amount, r is the interest rate per period, and n is the number of periods.

Substituting in the given values, we get:

$$PV = 500 \cdot \frac{1 - (1+0.07)^{-30}}{0.07} \approx 47,230.39$$

Therefore, the amount of the annuity is $\$ 47,230.39$.

Find the Amount of an Annuity That Consists Of 303030 Annual Payments Of

Find the Amount of an Annuity That Consists Of $30$ Annual Payments Of