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Sam gets deposits a total of $3500 every three months to the bank which earns a 6.5% p/a. After five years how much will he have in his account?

Ren wants to buy a new car that costs $26255, so, he would deposit money into his savings account with an interest rate of 3.9% p/a compounded every 4 months, this has been going on for two years now. Determine Ren’s regular payment to the bank?

  • Math - ,

    For Sam:
    F=future value
    R=payment per period, $3500
    i=interest, 0.065/4=0.01625
    n=number of periods, 5*4=20
    F=$81936 approx.

    For Ren
    Use the same formula for Sam, except
    F=26255, i=0.013, n=2*3=6,
    Find R. I get approx. $4236.

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