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Homework answers / question archive / Find the future value of the following ordinary simple annuity
Find the future value of the following ordinary simple annuity. Periodic Payment Payment Interval Term Interest Rate $497.00 3 months 9.75 years 7% Conversion Period quarterly The future value is $ (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)
Quarterly rate = 7% / 4 = 1.75%
Number of periods = 9.75 * 4 = 39
Future value = Payment * [(1 + rate)^periods - 1] / rate
Future value = 497 * [(1 + 0.0175)^39 - 1] / 0.0175
Future value = 497 * [1.96717 - 1] / 0.0175
Future value = 497 * 55.26696
Future value = $27,467.68
