Question

Nasir wants to accumulate $1500000 after 10 years. If investment earns interest at the rate of 8 percent per year compounded quarterly, then the amount he must be deposited at the end of each year is 

None of the above

 

$21,900

$22,354

$24,840

$23,220

Answer 1

find the formula:

$FV=X\times\frac{(1+r)^n-1}{r}$

FV= 1 500 000

n=40, $4\times10=40$

$r=\frac{8.5}{4}=2.125$

$1 500 000=X\times\frac{(1+0.02125)^{40}-1}{0.02125}$

$1 500 000=X\times 62.0660734$

x=24 166.26

None of the above