David wishes to accumulate $1 million by the end of 20 years by making equal annual end-of-year deposits over the next 20 years. if david can earn 10 percent on his investments, how much must he deposit at the end of each year? $50,000 $17,460 $14,900 $117,453

Question

Mathematics

Jonathan Lewis

3 November, 15:24

David wishes to accumulate $1 million by the end of 20 years by making equal annual end-of-year deposits over the next 20 years. if david can earn 10 percent on his investments, how much must he deposit at the end of each year? $50,000 $17,460 $14,900 $117,453

+1

Answers (1)

Know the Answer?

Brenton Jackson · Answer 1

The formula of the future value of an annuity ordinary is

Fv=pmt [ (1+r) ^ (n) - 1) : r]

Fv accumulated amount 1000000

PMT annual payment?

R interest rate. 0.1

N time 20 years

Solve the formula for PMT

PMT=FV:[ (1+r) ^ (n) - 1) : r]

PMT=1,000,000: (((1+0.1) ^ (20) - 1) : (0.1))

PMT=17,459.62 round your answer

PMT=17460