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You want to buy a new ski boat 2 years from now, and you plan to...

You want to buy a new ski boat 2 years from now, and you plan to save $7,000 per year, beginning one year from today. You will deposit your savings in an account that pays 6.2% interest. How much will you have just after you make the 2nd deposit, 2 years from now?

$17,609

$14,434

$14,290

$15,156

$16,599
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Answer #1

With the help of annuity formula, it is easy to know how much we can have in our bank account in the given number of years, at the interest rate prevailing in the bank and how much are we willing to save each year.

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