Question

You deposit $2000 each year into an account earning 8% interest compounded annually. How much will you have in the account in 25 years?

Answer 1

157908.83

Explanation:

RD formula is :

`P(1+(r)/(m) ) [(1+(r)/(m) )^(N) -1 }]{(m)/(r)`

where P: Principal / rd amount = $2000

r : interest = 8% = 0.08

m : no. of times compounded in a year = 1 (compounded annually)

N : time = 25 years

Amt =

`2000(1+(0.08)/(1) ) [(1+(0.08)/(1) )^(25) -1 }]{(1)/(0.08)`

`= 2000(1.08) [1.08^(25) -1 }]{(1)/(0.08)`

= 157908.83