An investment program was set up using an annuity due with payments of $1,200 at the beginning of each quarter. Consider payments for 5 years are made into an account expected to pay 8% compounded quarterly. What is the amount of annuity?

Elleanor Mckenzie

Elleanor Mckenzie

Answered question

2021-03-09

An investment program was set up using an annuity due with payments of $1,200 at the beginning of each quarter. Consider payments for 5 years are made into an account expected to pay 8% compounded quarterly. What is the amount of annuity?

Answer & Explanation

StrycharzT

StrycharzT

Skilled2021-03-10Added 102 answers

Use the formula:
A=C(1+i)n1i
Substitute from the given
A=$1200(1+0.08)2010.08
=$54,914.35

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