Louis and Claire just had a baby girl. They decide to make monthly contributions to a guaranteed investment certificate (GIC) in order to give her $40,000.00 for her post-secondary education. The interest on the investment is calculated at 3.5% compounded monthly for 18 years
Determine Louis and Claire’s monthly contribution.
I = 3.5
PV = 40000
PMT = - 249 (monthly contribution)
C/Y = 12
After graduation from high school, their daughter decides to travel for 2 years before going back to school. Louis and Clair decide to keep the $40,000.00 in the GIC and continue making the same monthly contributions for 2 more years. How much added interest will be earned?
? I've calculated the future value on my calc.& gives me
75 035.58643 ( I suspect this is the amount they get after 18 years
A= 75 035.59( 1 + 0.35/12)exp 12 x2 = ??
Thanks in advance for any help.