Answer to Question #310932 in Financial Math for lily

Question

Lindiwe de

ides that she would like to buy her daughter, Mbali, a

ar when she turns 21 in six years' time.

She deposits R6 000 ea

h month into an a

ount earning 8,94% interest per year,

ompounded monthly. The

amount that Lindiwe (rounded to the nearest rand) will have available six years from now is

Answer 1

it's an annuity

$FV=6000[(1+\frac{0.0894}{12})^{12×6}-1÷0.00745]$

$FV=6000(\frac{(1+0.00745)^{72}-1}{0.00745})=R568948.33$