Amy is going to need R145 000 in three years’ time, to pay for a
holiday...
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Finance
Amy is going to need R145 000 in three years’ time, to pay for aholiday overseas. She immediately starts to make monthly deposits into an account earning 11,05% interestper year, compounded monthly. Amy’s monthly deposit is [1] R3 384,18. [2] R3 415,34. [3] R4 027,78. [4] R4 707,20. [5] R4 750,55.
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Solution The formula for calculating the Future value of savings at the end of n months with monthly compounding is FV P 1 r n 1 r Where FV Future value of savings P Periodic Deposit ie Fixed amount of Monthly deposit r monthly rate of interest
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