Suppose I will need $ 7000 in 3 years. How much do I need to deposit each week into an account...

Question:

Suppose I will need ${eq}\displaystyle 7000 {/eq} in {eq}\displaystyle 3 \ years {/eq}. How much do I need to deposit each week into an account paying {eq}\displaystyle 3\% {/eq} annual interest compounded continuously in order to reach my goal?

Engineering Economy:

An annuity is the type of payment in which one person pays a fixed sum of money to someone each year. It can be done yearly or in other regular time intervals.

Answer and Explanation: 1

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Let:

FV = $7000; future value

t = 3 years

n = 52; since 1 year = {eq}52\frac{1}{7} {/eq} weeks

r = 3%

M= amount of weekly deposits made into the...

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What is Annuity? - Definition & Formula

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Chapter 2 / Lesson 7
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An annuity is a fixed amount of income paid at regular intervals, such as monthly or quarterly. Learn the definition and formula for annuity, review examples of annuities, and understand how to determine the value of annuities.


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