Kevin deposits $1220.33
each quarter into an annuity account for his child's college fund in order to accumulate a future value of $95,000
in 15
years. How much of the $95,000
will Kevin ultimately deposit in the account, and how much is interest earned? Round your answers to the nearest cent, if necessary.

To determine how much of the $95,000 Kevin will deposit and how much interest will be earned, we need to break this problem into two steps:

1. **Total amount Kevin deposits** over 15 years.
2. **Interest earned** on the annuity.

### Step 1: Calculate the total amount Kevin deposits

Kevin deposits $1,220.33 every quarter, and there are 4 quarters in a year. Over 15 years, he will make:

\[
15 \text{ years} \times 4 \text{ quarters/year} = 60 \text{ quarters}
\]

The total deposit amount is:

\[
\text{Total Deposit} = 1,220.33 \times 60
\]

### Step 2: Calculate the interest earned

To find the interest, we subtract the total deposit amount from the future value of the account:

\[
\text{Interest} = \text{Future Value} - \text{Total Deposit}
\]

Let me calculate these values.Kevin will ultimately deposit **$73,219.80** over the 15 years, and the interest earned will be **$21,780.20**.

Would you like further details or have any questions?

Here are 5 related questions:
1. What would happen if the deposit amount per quarter increased?
2. How does the interest rate affect the future value of the annuity?
3. What if Kevin wanted to accumulate $120,000 instead of $95,000?
4. How much would Kevin need to deposit each quarter if the interest rate was compounded monthly?
5. How does the frequency of compounding affect the final interest earned?

**Tip:** Regular deposits in an annuity grow faster with more frequent compounding periods, such as monthly or quarterly.

Kevin deposits $1220.33 each quarter into an annuity account for his child's college fund in order to accumulate a future value of $95,000 in 15 years. How much of the $95,000 will Kevin ultimately deposit in the account, and how much is interest earned? Round your answers to the nearest cent, if necessary.

Learn how Kevin's quarterly deposits of $1,220.33 into an annuity grow to a future value of $95,000 over 15 years. This step-by-step solution explains the total amount deposited and the interest earned using annuity and compound interest formulas. Suitable for students in Grades 10-12.

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