Math Problem Statement

What is the accumulated value of periodic deposits of $5,000 made into an investment fund at the beginning of every quarter, for 5 years, if the interest rate is 2.75% compounded quarterly? Round to the nearest cent. Use python

Solution

The accumulated value of the periodic deposits of $5,000 made at the beginning of every quarter for 5 years, with an interest rate of 2.75% compounded quarterly, is $107,543.02.

Do you want details or have any questions?

Here are 5 numbered questions you might want to ask:

  1. How is the future value of an annuity calculated?
  2. Can you explain the formula used in this calculation?
  3. What if the deposits were made at the end of each period instead?
  4. How does the compounding frequency affect the accumulated value?
  5. Can you show a breakdown of the calculations for each period?

Tip: When dealing with investments, always consider the impact of the compounding frequency on the returns.

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Math Problem Analysis

Mathematical Concepts

Compound Interest
Annuities

Formulas

Future Value of Annuity formula

Theorems

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Suitable Grade Level

High School