When your first child is born you begin to save for college

When your first child is born, you begin to save for college by depositing $300 per month in an account paying 12% interest per year. You increase the amount you save by 2% per year. With continuous investment and compounding, how much will have accumulated in the account by the time your child enters college 18 years later? (Round your answer to the nearest cent.)

Solution

Therefore, the accumulated amount in the account after 18 years is $72,576.

Year	Yearly deposit ($300*12)	Interest at 12% on closing balance + yearly deposit	Closing balance ($)
1	3,600	432	4,032
2	3,600	4464	8,064
3	3,600	8496	12,096
4	3,600	12528	16,128
5	3,600	16560	20,160
6	3,600	20592	24,192
7	3,600	24624	28,224
8	3,600	28656	32,256
9	3,600	32688	36,288
10	3,600	36720	40,320
11	3,600	40752	44,352
12	3,600	44784	48,384
13	3,600	48816	52,416
14	3,600	52848	56,448
15	3,600	56880	60,480
16	3,600	60912	64,512
17	3,600	64944	68,544
18	3,600	68976	72,576