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math

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A young executive deposits $400 at the end of each month for 7 years and then increases the deposits. If the account earns 7.2%, compounded monthly, how much (to the nearest dollar) should each new deposit be in order to have a total of $400,000 after 25 years

  • math -

    Accumulated value after 7*12=84th payment
    400((1+0.006)^84-1)/0.006=43522.55653
    This amount after 25 years-->158445
    Let P new payments then
    400000-158445=P*((1+0.006)^216-1)/0.006

    241555=P*440.087
    P=$549

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