Questions: Use the future value formula to find the indicated value. n=28; i=0.03; PMT=90; FV=? FV= (Round to the nearest cent.)

Transcript text: Use the future value formula to find the indicated value. \[ \mathrm{n}=28 ; \mathrm{i}=0.03 ; \mathrm{PMT}=\$ 90 ; \mathrm{FV}=? \] \[ \mathrm{FV}=\$ \square \] (Round to the nearest cent.)

Solution

Solution Steps

Step 1: Identify the Formula

To find the future value (FV) of an annuity, we use the formula: \[ FV = PMT \times \frac{(1 + i)^n - 1}{i} \]

Step 2: Substitute the Given Values

Substituting the given values into the formula:

$ PMT = 90 $
$ i = 0.03 $
$ n = 28 $

The equation becomes: \[ FV = 90 \times \frac{(1 + 0.03)^{28} - 1}{0.03} \]

Step 3: Calculate the Future Value

Calculating the expression: \[ FV = 90 \times \frac{(1.03)^{28} - 1}{0.03} \] After performing the calculations, we find: \[ FV = 3863.78 \]

Final Answer

$\boxed{FV = 3863.78}$

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