Answer :
Answer:
$50 per month
Step-by-step explanation:
Given
Total amount needed=$30,000
Deposits 3 years= 36 months
6% of the total amount
=6/100×$30,000
= 0.06×$30,000
=$1,800
She wants to make deposits if $1,800 over a period of 36 months
=$1,800/36
=$50 per month
Answer:
The answer to the question is
She must invest $251.85 each month to reach her goal
Step-by-step explanation:
Future value of an annuity is the amount a given stream of cash flows will be worth after a specified period. The future value represents the cumulative accumulation of payments made or borrowed and their respective interest made or interest charged.
The future value is given by
[tex]FV = PMT\frac{(1+r)^{n}-1 }{r}[/tex]
Where
FV = Future value =$30,000
PMT = Payment =
r = Interest rate for a given period = 6 % monthly
n = Number of periods of payments = 3 years or 36 months
Therefore we have
[tex]30000=PMT\frac{(1+0.06)^{36} -1}{(0.06)}[/tex] = PMT×119.12
Therefore PMT = 30000÷119.12 = $251.85
Therefore She would have to save $251.85 monthly to make up $30,000 in three years