Problem
Savings Plans: Frequency of Deposits for Annuities For this problem, you will be looking at the difference that the frequency of deposits and compounding makes on annuities. For all answers given as values of money, round down to the cent. For answers in percents, round to the tenth of a percent.
Make a table that shows how much money each person has in their annuity after 1 year, 5 years, 10 years, and 25 years. Calculate how much money each person has invested after 25 years, and how much interest they have earned after 25 years. Then express the interest earned after 25 years as a percent of the amount invested.
1. Avery invests $3120 per year in an annuity with a 3.9% APR, compounded annually.
2. Britt invests $780 per quarter in an annuity with a 3.9% APR, compounded quarterly.
3. Casey invests $260 per month in an annuity that earns 3.9% APR, compounded monthly.
4. Devyn invests $60 per week in an annuity that earns 3.9% APR, compounded weekly. (Use 52 weeks per year.)