Need help calculating this

account_circle Unassigned
schedule 1 Day
account_balance_wallet \$5

You plan to buy the house of your dreams in 6 years. You have estimated that the price of the house will be \$78,372 at that time. You are able to make equal deposits every month at the end of the month into a savings account at an annual rate of 5.50 percent, compounded monthly. How much money should you place in this savings account every month in order to accumulate the required amount to buy the house of your dreams?

Sep 1st, 2015

78,372 = c ( 1-1/ 4.583 ^2) /.4583

Based on the equation, it would take a deposit of at least 11 , 673\$.

Sep 1st, 2015

Wait, I have a correction.

Sep 1st, 2015

I noticed that I calculated for 72,000 instead of 78,372 .

78,372 = 0 + 4310.46 (interest accumulated)

Minus it from the left,

78,372 - 4310.46= 74,061.54

Then divide that by each year

74,061 / 6 =12,343.59

You would need \$ 12,343.59   every deposit.

Sep 1st, 2015

...
Sep 1st, 2015
...
Sep 1st, 2015
Oct 21st, 2017
check_circle
check_circle
check_circle

Secure Information

Content will be erased after question is completed.

check_circle