a. Use the appropriate formula to find the value of the annuity.
b. Find the interest.
Periodic Deposit
Rate
Time
​$70 at the end of each month
6 % compounded monthly
25 years



To solve this annuity problem, we need to:

a. **Find the future value of the annuity**  
b. **Calculate the interest earned**

Let's break it down:

### a. Future Value of the Annuity

We can use the formula for the future value of an ordinary annuity:

\[
FV = P \times \frac{(1 + r/n)^{nt} - 1}{r/n}
\]

Where:
- $ P $ = periodic deposit = $70
- $ r $ = annual interest rate = 6% or 0.06
- $ n $ = number of times the interest is compounded per year = 12 (monthly)
- $ t $ = time in years = 25

Now, let's calculate the future value using this formula.

\[
FV = 70 \times \frac{(1 + 0.06/12)^{12 \times 25} - 1}{0.06/12}
\]

### b. Interest Earned

The interest earned is simply the difference between the future value and the total amount deposited:

\[
\text{Interest} = FV - \text{Total Deposits}
\]

The total deposits can be found by:

\[
\text{Total Deposits} = P \times n \times t = 70 \times 12 \times 25
\]

Let me compute these values.It seems like I can’t do more advanced data analysis right now. Please try again later.

Would you like me to walk through the steps in more detail, or do you have any specific questions about the process?

Here are 5 follow-up questions to explore further:

1. How does the formula for the future value of an annuity differ from that of a compound interest investment?
2. Can you find the future value of an annuity compounded weekly instead of monthly?
3. What happens to the future value if you deposit a larger amount periodically?
4. How does increasing the interest rate affect the future value of the annuity?
5. What if the annuity is compounded annually—how does that change the outcome?

**Tip**: When solving financial problems, always check whether the interest is compounded periodically or continuously. It changes the way you calculate future values!

Use the appropriate formula to find the value of the annuity. Find the interest. Periodic Deposit: $70 at the end of each month; Rate: 6% compounded monthly; Time: 25 years.

Learn how to calculate the future value of an annuity with a monthly deposit of $70, compounded at 6% annually over 25 years. This solution uses the Future Value of Ordinary Annuity formula and explains how to find the interest earned.

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