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Deposit at the end of each year for Janice Smith

Janice Smith wishes to accumulate $8,000 by the end of 5 years by making equal annual end-of-year deposits over the next five years. If Janice can earn 7 percent on her investments, how much must she deposit at the end of each year to meet this goal?

Solution Preview

We have to use annuity formula to solve the problem.

FVA = W x (1 + i)n - 1 where FVA is the future ...

Solution Summary

This solution is comprised of a detailed calculation to find the deposit to be made each year by Janice Smith.