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Math Help - Annuities and Interest Formulas

  1. #1
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    Annuities and Interest Formulas

    So in my math class I have decided to do a project on Annuties and Interest but I have run into a problem.

    So this is the formula I use for it FV=PMT (1 + i)n -1 / i

    i= Interest
    n= number of compounding periods
    PMT= Amount of Periodic Payment
    FV= Future Value

    So I had to make up my own Annuity and Interest problem and then solve it in a real life situation

    So I decided to do this.

    I want to invest $5,000 into a savings account at an interst of %4 compounded monthly. How much would it earn at the end of 5 years?

    i= %4 (percent) / 12 (months)= %0.333 (repeating) per month in Interest.

    n= (12)[months] x (5)[years]= 60[months]

    PMT= $5,000

    The equation is 5,000(1.0333)60-1/0.0333

    IF I got everything right.

    But for some reason when I try to calculate this I get a syntax error?

    Any reason why this may be?
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  2. #2
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    Use a simpler formula: A = P(1+i)^n

    A = ??? (solving for this)
    P = 5000
    I = 4% / 12
    n = 5*12 = 60
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  3. #3
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    FV = 100(1.004167)60 -1 .004167
    = 6,800.68.

    Can anyone tell me how this should be calculated? I can never get the answer.
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