After 12 years the final value of an ordinary annuity with 6

After 12 years the final value of an ordinary annuity, with 6% interest compounded quarterly, is $ 1, 391, 304.39 Determine the amount that was deposited in this annuity at the end of each period.

Solution

time = 12 years

rate of interest = 6% compounded quarterly

final value = 1391304.39

applying the formula

A = P ( ( 1+r)^n -1 ) / r

r = .06 / 4 = .015

1391304.39 = P ( 1 + .015)^48 - 1) / .015

P = 1391304.39 / 69.56 = 20001.50

periodic payment = $ 20001.50