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  • 4 years ago

3. Lena Dimock is saving for her college expenses. She sets aside $200 at the beginning of each three months in an account paying 8% annual interest, compounded quarterly. How much will Lena have accumulated in the account at the end of four years?

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  1. anonymous
    • 4 years ago
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    Use the future value annuity formula\[FV=PMT((1+i)^n-1)\div(i)\] where FV=future value PMT = Periodic payment amount i=interest rate n=number of periods (4 per year * 4 years = 16) \[FV=200((1+.08)^{16}-1)\div.08=$6064.86\] |dw:1327603496343:dw|

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