Given an 8 percent interest rate, compute the year 7 future value if deposits of

Question

Given an 8 percent interest rate, compute the year 7 future value if deposits of $2,800 and $3,800 are made in years 1 and 3, respectively, and a withdrawal of $1,150 is made in year 4. (Do not round intermediate calculations and round your final answer to 2 decimal places.)

use excel if possible please

Given an 8 percent interest rate, compute the year 7 future value if deposits of $2,800 and $3,800 are made in years 1 and 3, respectively, and a withdrawal of $1,150 is made in year 4. (Do not round intermediate calculations and round your final answer to 2 decimal places.)

use excel if possible please

Explanation / Answer

Computation of the future value.We have,

Future value = 2,800(1.08)6 + 3,800(1.08)3 - 1,150(1.08)2

Future value = 4,443.25 + 4,786.91 - 1,341.36

Future value = $ 7,888.80

Hence,the year 7 future value is $ 7,888.80

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