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Homework answers / question archive / Mrs
Mrs. Simpson is saving for her retirement. If she makes a payment of $1000 at the end of each month for 15 years and earns a rate of 5.25% compounded 12 times per year how much will she have in her retirement account when she is ready to retire?
Computation of Accumulated Amount using FV Function in Excel:
=-fv(rate,nper,pmt,pv)
Here,
FV = Accumulated Amount or Future Value = ?
Rate = 5.25%/12
Nper = 15 years * 12 months = 180 months
PMT = $1,000
PV = 0
Substituting the values in formula:
=-fv(5.25%/12,180,1000,0)
FV or Accumulated Amount or Future Value = $272,942.36
So, she will have $272,942.36 in her retirement account when she is ready to retire.
