Math Problem Statement

Suppose you'd like to save enough money to pay cash for your next car. The goal is to save an extra $22,000 over the next 3 years. What amount must be deposited quarterly into an account that earns 4.7% interest, compounded quarterly, in order to reach your goal? Round your answer to the nearest cent, if necessary.

Solution

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Math Problem Analysis

Mathematical Concepts

Compound Interest
Annuities
Time Value of Money

Formulas

Future Value of an Ordinary Annuity: FV = P × ((1 + r)^n - 1) / r

Theorems

Compound Interest Theorem
Annuity Formula Theorem

Suitable Grade Level

Grades 11-12 or College Level