Find the savings plan balance after 2 years with an APR of 6% and monthly payments of $250.
Just use your formula
P((1+r/12)^12n - 1)/r
To find the savings plan balance after 2 years with an APR of 6% and monthly payments of $250, we can use the formula for the future value of an ordinary annuity.
The future value of an ordinary annuity formula is given by:
FV = P * ((1 + r)^n - 1) / r
Where:
FV = Future Value
P = Monthly Payment
r = Monthly Interest Rate
n = Number of Payments
First, we need to convert the annual percentage rate (APR) into a monthly interest rate. We can do this by dividing the APR by 12.
APR = 6%
Monthly Interest Rate (r) = 6% / 12 = 0.005
Next, we need to calculate the number of payments for 2 years. Since there are 12 months in a year, the number of payments (n) will be:
n = 2 years * 12 months/year = 24 months
Now we can plug the values into the formula:
FV = $250 * ((1 + 0.005)^24 - 1) / 0.005
Using a calculator or spreadsheet, we can evaluate this expression:
FV ≈ $6,579.13
Therefore, the savings plan balance after 2 years with an APR of 6% and monthly payments of $250 would be approximately $6,579.13.
To find the savings plan balance after 2 years with an Annual Percentage Rate (APR) of 6% and monthly payments of $250, you can use the formula for the future value of an ordinary annuity.
The formula for the future value of an ordinary annuity is:
FV = P * [(1 + r)^n - 1] / r
Where:
FV = Future Value (savings plan balance)
P = Monthly Payment ($250)
r = Monthly Interest Rate (APR / 12 / 100)
n = Number of Periods (2 years * 12 months/year)
First, let's calculate the monthly interest rate (r):
r = APR / 12 / 100
= 6 / 12 / 100
= 0.005 (or 0.5%)
Next, calculate the number of periods (n):
n = 2 years * 12 months/year
= 24 months
Now, substitute the values into the formula:
FV = 250 * [(1 + 0.005)^24 - 1] / 0.005
Calculating this using a calculator, you will find the savings plan balance after 2 years.
Note: This formula assumes that the monthly payments are made at the end of each month, and the interest is compounded monthly.