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I'm struggling with this question For the last 8 years Steve has made deposits of ​$92.00...

I'm struggling with this question

For the last 8 years Steve has made deposits of ​$92.00 at the end of every month earning interest at 8 % compounded monthly. If he leaves the accumulated balance for another 6 years at 4 % compounded annually comma what will the balance be in the​ account?

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Answer #1

We first need to compute the amount accumulated till date, using the FV of annuity formula

n = 8 * 12 = 96 months, r = 8%/12 = 0.6667%

FV = 92 * 133.87

FV = $12,315.91

Now, this would be compounded further for 6 years

FV = $12,315.91 * 1.2653

FV = $15,583.55

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