Jorgen Grace made deposits of $250 at the end of each year for 12 years. The rate received was 6% annually. What is the value of the investment after 12 years?

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Mathematics

28 January, 03:55

Jorgen Grace made deposits of $250 at the end of each year for 12 years. The rate received was 6% annually. What is the value of the investment after 12 years?

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Mark Ramsey · Answer 1

Deposits made is $250, it is called Present value P = 250 Rate of interest r = 6% = 0.06 Time n = 12 years, 12 payments Investment value after n years FV = FV = P * (1+r) * (((1+r) ^ n) â€" 1) / r FV = 250 * (1 + 0.06) * (((1 + 0.06) ^12) - 1) / 0.06 FV = 250 * 1.06 * (((1.06) ^12) - 1) / 0.06 = > FV = 250 * 1.06 * (2.012 - 1) / 0.06 FV = 250 * 1.06 * 1.012/0.06 = > FV = 250 * 1.06 * 16.87 FV = 250 * 17.88 = > FV = 4470.5 So the final value of investment after 12 years is $4470.5.