Glenda deposits $4, 000 every three months for five years.The first deposit is made on March 31, 2010, and the last deposit is made on December 31, 2014.The fund earns 16%, and interest is compounded quarterly.How much money will Glenda have on December 31, 2014, immediately after her last deposit? Factors for future value of an annuity of $1 are $i\text { For Values of } n \text { and } i$
$n=5;i=16%n=20;I=4%6.877129.7781\begin{array}{ll}n=5 ; i=16 \% & n=20 ; I=4 \% \\6.8771 & 29.7781\end{array}$

A) $123, 876
B) $119, 112
C) $110, 034
D) $107, 508

Question

Glenda deposits $4, 000 every three months for five years.The first deposit is made on March 31, 2010, and the last deposit is made on December 31, 2014.The fund earns 16%, and interest is compounded quarterly.How much money will Glenda have on December 31, 2014, immediately after her last deposit? Factors for future value of an annuity of $1 are

i\text { For Values of } n \text { and } i

n=5;i=16%n=20;I=4%6.877129.7781\begin{array}{ll}n=5 ; i=16 \% & n=20 ; I=4 \% \\6.8771 & 29.7781\end{array}

A) $123, 876
B) $119, 112
C) $110, 034
D) $107, 508

Killian Carles · Accepted Answer

Final Answer : B, Explanation :  The correct answer is found by using the future value of an annuity formula, considering the quarterly deposits and the quarterly compounding interest rate. Since Glenda deposits $4,000 every three months for five years, there are a total of 20 periods (5 years * 4 quarters per year). The interest rate per quarter is 4% (16% annual rate divided by 4). Using the future value of an annuity factor for n=20 and i=4% from the table, which is 29.7781, the future value of Glenda's annuity can be calculated as $4,000 * 29.7781 = $119,112.

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