Periodic Deposit 5,000 at the end of teh each year, Rate: 4%, Time: 30 years

a. After 30 yearsyou will have aproximately$____?

b. The interest is approximately$___?

### 1 Answer | Add Yours

The future value, F is given by,

`F= P(((1+i)^n -1)/i)`

P is the periodic installment, i is the interest rate for the period and n is the number of periods.

`F= 5000(((1+0.04)^30 -1)/0.04)`

`F= 5000((1.04^30 -1)/0.04)`

`F = 5000 xx 56.0849`

`F = 280424.5`

**After 30 years, you would have 280424.5**

The total investment `= 30 xx 5000 = 150000`

Therefore the interest is `= 280424.50 - 150000 = 130424.50`

**Therefore the interest is 130424.50.**

**Sources:**

### Join to answer this question

Join a community of thousands of dedicated teachers and students.

Join eNotes