# Future value at end of 5 years; future value of an annuity

1. An investor deposits $50,000 today in an interest bearing account. The account pay 7% interest annually, and the investor expects to withdraw the principal plus interest at the end of 5 years. How much would the investor accumulate by the end of 5 years if interest is compounded monthly?

2. You plan to deposit $500 at the beginning of each month in an account for a period of 10 years. Interest is to be compounded monthly at an annual rate of 5%. What is the future value of this series of deposits at the end of 10 years?

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#### Solution Preview

An investor deposits $50,000 today in an interest bearing account. The account pay 7% interest annually, and the investor expects to withdraw the principal plus interest at the end of 5 years.

How much would the investor accumulate by ...

#### Solution Summary

The future value at end of five years and the future value of annuity is determined. How much an investor would accumulate by the end of 5 years if interest is compound monthly is found.