Q:

Find the savings plan balance after 3 years with an APR of 7​% and monthly payments of ​$150.The Balance is $_____

Accepted Solution

A:
Answer:The balance is $5989.5Step-by-step explanation:The savings plan balance is given by the following formula:[tex]A = P*\left[\frac{(1 + \frac{APR}{n})^{n*Y} - 1}{\frac{APR}{n}}\right][/tex]In which A is the savings plan balance, P is the monthly payment, APR is the annual percentage rate(decimal), n is the number of payments per year and Y is the number of years.In this problem, we have thatFind the savings plan balance after 3 years with an APR of 7​% and monthly payments of ​$150.So we have to find A when [tex]P = 150, APR = 0.07, n = 12, Y = 3[/tex].So[tex]A = P*\left[\frac{(1 + \frac{APR}{n})^{n*Y} - 1}{\frac{APR}{n}}\right][/tex][tex]A = 150*\left[\frac{(1 + \frac{0.07}{12})^{12*3} - 1}{\frac{0.07}{12}}\right][/tex][tex]A = 5989.5[/tex]The balance is $5989.5