A=M [(1=r/n with an upper nt at right hand corner -1] than under that there is a r/n
for m,r,and t assume monthly payments round to the nearest cent
$150;8%; 40 years
A=$
your formula lacks. It makes no sense
are we doing amount of an annuity here? here?
If so:
A = payment [ (1+r)^n -1 ]/r
r is interest PER PERIOD = .08/12 = .006667
n is number of periods = 40*12 = 480 months
payment = 150
A = 150 [1.006667^480 -1 ] / .006667
A = 150(23.27339)/.006667
A = $ 523,624.99
Evaluate an ordinary annuity formula
A= m [(1+r over n)^nt -1]
_______
r over n
for m, r, t respectively. Assume monthly payments. Round to the nearest cent. $150; 8%; 40 yr
thank you very much you made my day
That is what I did Mary Ann
I use r = interest rate/number of payments in a year
so your n t is my n
and your r/n is my r
and my n is 40 *12, your n t
To find the value of A, we need to use the formula A = M[(1+r/n)^(nt) - 1] / (r/n), where:
A = the future value or total amount
M = the monthly payment
r = annual interest rate
n = number of times interest is compounded per year
t = number of years
From the given values, we have:
M = $150 (monthly payment)
r = 8% (annual interest rate)
n = 12 (compounded monthly)
t = 40 (number of years)
Now, let's plug these values into the formula and calculate it step by step:
Step 1: Convert the annual interest rate to a decimal:
r = 8% = 0.08
Step 2: Calculate the interest rate per compounding period:
i = r/n = 0.08/12 = 0.00666667 (rounded to the nearest cent)
Step 3: Calculate the total number of compounding periods:
nt = n * t = 12 * 40 = 480
Step 4: Calculate the future value or total amount:
A = M[(1+i)^(nt) - 1] / i
= $150[(1+0.00666667)^(480) - 1] / 0.00666667
Now, let's plug in the values into a calculator or perform the calculation manually:
(1+0.00666667)^(480) ≈ 12.699704
A = $150[(12.699704) - 1] / 0.00666667
≈ $150[11.699704] / 0.00666667
A = $1769.96 / 0.00666667
≈ $265,499.92
Therefore, the value of A (the future value or total amount) is approximately $265,499.92.