Terry started saving $50 a month at age 25 in an account earning 6% compounded monthly.At age 40,she will have ____ in this account.(Use time value tables or financial calculator.)

Question

Quizplus · Accepted Answer

Terry saves for 15 years (180 months). Using the future value of an annuity formula for monthly compounding: FV = Pmt * [(1 + r)^n - 1] / r, where Pmt = $50, r = 0.06/12, and n = 180. Calculating gives approximately $14,541.

Terry Started Saving $50 a Month at Age 25 in an Account