A deposit of $50 is made on the first day of each month

A deposit of $50 is made on the first day of each month in an account that pays 6% interest, compounded monthly. What is the balance at the end of 2 years?

Solution

S = R{[(1 +i)n -1]/i}

S = Future value

R = Periodic payment , here R = $50

i = interest rate per period, here i = (6/12) = 0.5% = 0.005

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