Question

You are saving for a car that you plan to purchase in five years. You plan to put $3,000 in savings (which earns 10%, compounded annually) at the end of each year until then. How much will you have saved for the car at the end of the five years? (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value Annuity of $1.) (Use appropriate factor from the PV tables. Round your final answer to the nearest dollar amount.)

Answer #1

Answer: |

Amount of Savings =
Present Savings x Future Value of Annuity ( 10% , 5 years) = $3,000 x 6.1051 = $18,315.30 (or) $18,315 |

Amount of Savings at the end
of 5 Years = $18,315 |

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