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find the future value of an ordinary annuity of $110 paid at the end of each quarter for five years if interest is earned at a rate of 6% compounded quarterly ....round to 2 decimal places

Sagot :

Given:

Amount paid is, p = $110.

Interest rate is, r = 6%=0.06.

Nmber of years, t = 5 years.

Number of times per year is, n = 3 (each quarter).

The objective is to find the future values compounded quarterly.

The general formula to find the compound interest is,

[tex]A=P(1+\frac{r}{n})^{n(t)}[/tex]

Substitute the given values in the above equation.

[tex]\begin{gathered} A=110(1+\frac{0.06}{3})^{3(5)} \\ A=110(1+0.02)^{15} \\ A=148.05 \end{gathered}[/tex]

Hence, the future value is .

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