Friday

August 29, 2014

August 29, 2014

Posted by **Blanca** on Thursday, December 8, 2011 at 6:57pm.

- algebra -
**tchrwill**, Friday, December 9, 2011 at 10:25amWhat is the monthly deposit required to accumulate to a fund of $1,000,000 over a period of 40 years with deposits starting at the end of the first month and bearing an interest rate of 8% compounded monthly?

S(n) = $1,000,000]

i = .08/12 = .00666...

n = 40(12) = 48

R = S(n)(i)/[(1+i)^n - 1]

1,000,000(.00666...)/[1.00666...)^48-1]

$17,746.25

As for the present value,

P = R[1 - (1+i)^-n]/i

P=17,746.25[1-(1.00666...)^-40]/.00666...

P = $726,920.

**Related Questions**

Algebra - Suppose a student wants to be a millionaire in 40 years. If she has an...

algebra - 3. Suppose a student wants to be a millionaire in 40 years. If she has...

math - Suppose a student wants to be a millionaire in 40 years. If she has an ...

math - Suppose a student wants to be a millionaire in 40 years. If she has an ...

algebra - 1. Suppose Mary deposits $200 at the end of each month for 30 years ...

algebra - Suppose Mary deposits $200 at the end of each month for 30 years into ...

Compound math - (Future Value) Suppose you invest $8000 into an account that ...

Finance - 1. A man establishes an annuity for retirement by depositing $50,000 ...

Finite Mathematics - Jessica wants to accumulate $14,000 by the end of 5 yr in a...

math - This problem has to do with exponential models. The question says, you ...