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Essay text:
You invest $250 in your savings account at the end of each year and earn an average of 6% per year in interest. How much will you have in your savings account at the end of forty years?
Saving per year = $250
Rate of Interest = 6% or 0.06
Savings after 40 years = 250 FVIFA 0.06,40 = 250 x 154.76 = $38,690.
3. You want to have $40,000 to buy a new boat in six years. How much do you have to save at the end of each year to reach this goal if you earn 5% a year on your savings?
Sum Desired at end of 6 years = $40,000
Interest Earned Per Year = 5% or 0.05
How Much to Save each year = 40000 / PVIFA 0...
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