Annuities

Can someone tell me if this is ordinary annuity of future or ordinary values sinking funds present value or what is it. The question is You are earning an average of 46500 and will retire in 10 years. If you put 20% of your gross average income in an ordinary annuity compounded at 7% annually, what will be the value of the annuity when you retire? I am using a texas instrument calculator for figuring and using formulas to do this HELP HELP

  1. 👍 0
  2. 👎 0
  3. 👁 101
  1. You put in P = 9,300 per year for n = 10 years at interest rate r = .07
    You can do this as a future value of annuity or amount of a sinking fund. N is accumulated after n years.
    N = P * [(1+r)^n - 1 ] / r

    N = 9300 * [ (1.07)^10 - 1 ] / .07

    N = 128,493

    1. 👍 0
    2. 👎 0
    posted by Damon
  2. With my TI 83 + calculator:
    type 9300
    type * times key x
    left paren
    1.07^10 -1
    right paren
    enter
    get 8994.5...
    divide key
    .07
    enter
    get
    128492.966

    1. 👍 0
    2. 👎 0
    posted by Damon
  3. that is what i was wondering if i had to figure out the from the 46500 the 20 percent and use that thanks

    1. 👍 0
    2. 👎 0

Respond to this Question

First Name

Your Response

Similar Questions

  1. ALegbra

    If an apartment complex will need painting in 3 1/2 years and the job will cost $25,000, what amount needs to be deposited into an account now in order to have the necessary funds? The account pays 8% interest compounded

    asked by Mary Ann on May 16, 2014
  2. math

    Classify the finacial problem. Assume a 7% interest rate compounded annually. Find the value of a $ 1,000 certificate in 4 years. a) sinking fund, b) ordinary annuity, c) future value, d) present value e) amortization.

    asked by Andrew on March 2, 2013
  3. math

    Classify the finacial problem. Assume a 7% interest rate compounded annually. Find the value of a $ 1,000 certificate in 4 years. a) sinking fund, b) ordinary annuity, c) future value, d) present value e) amortization

    asked by Andrew on March 3, 2013
  4. Accounting

    On June 1, 2012, Pitts Company sold some equipment to Gannon Company. The two companies entered into an installment sales contract at a rate of 8%. The contract required 8 equal annual payments with the first payment due on June

    asked by Jed on October 17, 2012
  5. Accounting

    On June 1, 2012, Pitts Company sold some equipment to Gannon Company. The two companies entered into an installment sales contract at a rate of 8%. The contract required 8 equal annual payments with the first payment due on June

    asked by Jed on October 17, 2012
  6. Math

    Amy Powell invested $8500 twice a year in an ordinary annuity at New York Securities for a period of 5 years at an annual interest rate of 10% compounded semiannually. Using the ordinary annuity table , calculate the total value

    asked by Melissa on February 27, 2013
  7. finite math

    A $1.2 million state lottery pays $5,000 at the beginning of each month for 20 years. How much money must the state actually have in hand to set up the payments for this prize if money is worth 7.7%, compounded monthly? (a) Decide

    asked by help plzzz on May 1, 2011
  8. Math

    The amount to be financed on a new car is $9,500. The terms are 11% for 4 years. What is the monthly payment? (a) State the type. future value ordinary annuity present value amortization sinking fund (b) Answer the question.

    asked by Ronald on June 14, 2013
  9. Finite Math

    The amount (future value) of an ordinary annuity is given. Find the periodic payments. A = $2500, and the annuity earns 6.5% compounded annually for 4 years.

    asked by Matt on February 18, 2013
  10. Finite Math

    The amount (future value) of an ordinary annuity is given. Find the periodic payments. A = $14,500, and the annuity earns 6% compounded monthly for 10 years.

    asked by Matt on February 18, 2013

More Similar Questions