Bruce Lee wishes to accumulate $1 million by making equal annual end-of-year deposits over the next 20 years.If Bruce can earn 10 percent on his investments,how much must he deposit at the end of each year?
A)$14,900
B)$50,000
C)$117,453
D)$17,460

Question

Quizplus · Accepted Answer

The future value of an annuity formula is used to calculate the annual deposit: FV = Pmt * [(1 + r)^n - 1] / r. Solving for Pmt with FV = $1,000,000, r = 0.10, and n = 20 gives approximately $17,460.

Bruce Lee Wishes to Accumulate $1 Million by Making Equal