Concept explainers
Periodic savings Suppose you deposit m dollars at the beginning of every month in a savings account that earns a monthly interest rate of r, which is the annual interest rate d vided by 12 (for example, if tine annual interest rate is 2.4%, r − 0.024/12 − 0.002). For an initial investment of m dollars, the amount of money in your account at the beginning of the second month is the sum of your second deposit and your initial deposit plus interest, or m | m(l | r). Continuing in this fashion, it can be shown that tie amount of money in your account after n months is An m + m(1 + r) + ⋯ + m( 1 + r)n . Use geometric sums to determine the amount of money in your savings account after 5 years (60 months) using the given monthly deposit and interest rate.
16. Monthly deposits of $100 at an annual interest rate of 1 8%
Want to see the full answer?
Check out a sample textbook solutionChapter 10 Solutions
Calculus, Single Variable: Early Transcendentals (3rd Edition)
- Interest Ron Hampton needs to choose between two investments: One pays 6% compounded annually, and the other pays 5.9% compounded monthly. If he plans to invest 18,000 for 2 years, which investment should he choose? How much extra interest will he earn by making the better choice?arrow_forwardNew grandparents decide to invest 3200 per month in an annuity for their grandson, The account will pay interest per year which is compounded monthly. How much will be in the child's account at his twenty-first birthday?arrow_forward
- Calculus For The Life SciencesCalculusISBN:9780321964038Author:GREENWELL, Raymond N., RITCHEY, Nathan P., Lial, Margaret L.Publisher:Pearson Addison Wesley,Glencoe Algebra 1, Student Edition, 9780079039897...AlgebraISBN:9780079039897Author:CarterPublisher:McGraw Hill
- College Algebra (MindTap Course List)AlgebraISBN:9781305652231Author:R. David Gustafson, Jeff HughesPublisher:Cengage Learning