New parents wish to save for their newborn's education and wish to have $39,000 at the end of 17 years. How much should the parents place at the end of each year into a savings account that earns an annual rate of 4.9% compounded annually? (Round your answers to two decimal places.)
$ 
1,522.48
 
Correct: Your answer is correct.


How much interest would they earn over the life of the account?
$ 
13117.84
 
Correct: Your answer is correct.


Determine the value of the fund after 11 years.
$ 
How do I plug this last part into a finance ti-84 part of a calculator

To determine the value of the fund after 11 years using a TI-84 financial calculator, you will follow these steps:

### Step-by-Step Guide for Plugging into the TI-84:

1. **Access the TVM Solver**:
   - Press the `2nd` button, then press the `FINANCE` button (above `X^-1`).
   - Scroll down to select `TVM Solver` (option 1).

2. **Input the Known Variables**:
   - **N**: Total number of years into the future you're solving for (11 years in this case). Since we're making payments annually, leave this as 11.
   - **I%**: This is the annual interest rate. Enter `4.9` for 4.9%.
   - **PV (Present Value)**: Since the parents are starting from $0, enter `0`.
   - **PMT (Payment)**: This is the amount the parents deposit each year. Enter `-1522.48` (negative because it's an outflow).
   - **FV (Future Value)**: This would be $0 unless you want to adjust it. Leave it unchanged in this step.
   - **P/Y (Payments per Year)**: Enter `1` since payments are made once per year.
   - **C/Y (Compounding per Year)**: Also enter `1` since the interest is compounded annually.

3. **Compute the Fund's Value After 11 Years**:
   - After inputting the values, highlight the **FV (Future Value)** field.
   - Press `ALPHA` followed by `ENTER` to compute the future value.

This will give you the value of the fund after 11 years.

If you follow these steps correctly, the TI-84 will display the future value of the savings account after 11 years.

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Let me know if you need further details or help!

Here are 5 follow-up questions related to the previous topic:

1. How does changing the interest rate affect the amount saved?
2. What if the parents deposited at the beginning of each year instead of the end?
3. How would semi-annual compounding change the calculations?
4. What is the total amount deposited by the parents after 17 years?
5. What would the fund value be after 17 years if the interest rate was only 3%?

**Tip**: Always ensure the correct compounding period is selected on your financial calculator to avoid incorrect results!

New parents wish to save for their newborn's education and wish to have $39,000 at the end of 17 years. How much should the parents place at the end of each year into a savings account that earns an annual rate of 4.9% compounded annually? (Round your answers to two decimal places.)

Learn how to calculate how much parents need to save annually to accumulate $39,000 in 17 years at a 4.9% annual interest rate compounded annually. This problem covers key finance concepts, including the future value of an annuity and compound interest. Suitable for high school and college students.

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