posted by Kate .
Hi im unsure how do this problem becasue I do not how to go about these types of problems were you make monthely payments each month of the same amount...
Janene contributes $50 per month inot the Chaing China Bond Fund htat earns 7.26% annual intrerest. What is the value of Hanene's investment after 25 years (assuming that Mr. Chiang has not skipped twon with her dough?)
I don't even know what formula to use...
The answer depends somewhat upon whether interest is compounded monthly, quarterly or annually, etc. It is easier to do if the interest is compounded monthly, the same frequency that investments are made.
A total of 25 x 12 = 300 payments of $50 are made into the account. Using this website:
I get a total after 25 years of $42,516
Make that 42,516.84. There is a formula that could be used, but I don't know it. reiny probably knows the formula.