1139827 3 An executive prepares for retirement by depositing

113982.7 3 An executive prepares for retirement by depositing $3000 into an annuity each year for 20 years. The annuity earns 6.3%per year. Find the future value of the annuity at the end of 20 years. (Round your final answer to two decimal places.)

Solution

Annuity Value = $ 3000, Annuity Duration = 20 years and Annuity Interest Rate = 6.3 % per annum

Future Value = 3000 x (1.063)^(19) + 3000 x (1.063)^(18) + 3000 x (1.063)^(17) + ........+ 3000 = $ 113982.68 approximately.