The Ajax Co. just decided to save $1,500 a month for the next five years as a safety net for recessionary periods. The money will be set aside in a separate savings account which pays 3.25% interest compounded monthly. It deposits the first $1,500 today. If the company had wanted to deposit an equivalent lump sum today, how much would it have had to deposit?
Please see the attached file for the complete solution.
Use the Present Value of an Annuity Due ...
The solution to finding out how much a company would have to deposit to get an equal value is shown. All formulas and calculations are attached.