Asked by Isaiah Estilien on May 15, 2024
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Charles Moore wants to deposit an equal amount each month into an account that will pay 9% compounded monthly. If Charles wants to end up with a future value of $15,000 after 25 months, how much should he deposit each month? Use Tables 23-1A and 23-1B or a calculator.
Compounded Monthly
A calculation method where interest is added to the principal sum at the end of each month, and future interest is calculated on the new total.
Future Value
Also known as the compound amount, the total value of an investment; equal to the principal plus all the compound interest.
Equal Amount
A quantity that is the same in size, number, or value when compared to another.
- Understand and apply the concepts of future value and present value of annuities and investments.
- Calculate the required regular deposit amount to achieve a specific future value under various compounding intervals.
- Apply financial tables or calculators for precise financial planning and calculations.
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CM
Learning Objectives
- Understand and apply the concepts of future value and present value of annuities and investments.
- Calculate the required regular deposit amount to achieve a specific future value under various compounding intervals.
- Apply financial tables or calculators for precise financial planning and calculations.