Answer:
Total FV= $14,011.21
Explanation:
Giving the following information:
Annual deposit= $1,200 (beginning)
Number of periods= 20 years
Interest rate= 6%
To calculate the total future value, we need to use the following formula on each deposit:
FV= [PV*(1+i)^n]
FV1= [1,200*(1.06^20)]
FV1= 3,848.56
FV2= [1,200*(1.06^16)]
FV2= 3,048.42
FV3= [1,200*(1.06^12)]
FV3= 2,414.64
FV4= [1,200*(1.06^8)]
FV4= 1,912.62
FV5= [1,200*(1.06^4)]
FV5= 1,514.97
FV6= [1,200*1.06]
FV6= 1,272
Total FV= $14,011.21
