MATH 1070Q Lecture Notes - Lecture 15: 12 X 5
19 Oct 2017
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You are making periodic payments of a loan. Difference: compound/simple investment is a complete up front investment. This is when you are making equal payments periodically. We invest 500 into an account each year w/ annual rate of 6% compounded annually. total value after 10 years: N = total number of payments = mt = 1 x 10 = 10 i = periodic interest rate = r / m = . 06/ 1 = . 06. If we invest a month for the next 5 years at an annual rate of 6. 8%. N = 12 x 5 = 60. Use f = p (1 + r/m) ^mt. Our money earns interest over time, so interest is in our favor. If we need to accumulate a million at a rate of 5. 5%, compounded monthly after. 25 years. how much should our monthly deposit be? i = r/m. Our monthly payment will need to be 1, 557. 54.
