Answer:
Yolanda will have a balance of $34,043.10 in 14 years.
Step-by-step explanation:
This is an Ordinary annuity question where you pick the hint from the equal and recurring monthly payment.
To find the Future value of Yolanda's savings after 14 years, use Future value of annuity formula FVA = [tex]\frac{PMT}{r}[1-(1+r)^{-t} ]\\[/tex]
PMT= recurring payment = $300
r = discount rate; monthly rate in this case = 6% / 12 =0.5% or 0.005 as a decimal.
t = total duration ; 14 *12 = 168 months
Next, plug in the numbers into the FVA formula;
FVA = [tex]\frac{300}{0.005} [ 1-(1+0.005)^{-168} ][/tex]
FVA = 60,000 * 0.5673849
FVA = 34,043.0969
Therefore, Yolanda will have a balance of $34,043.10 in 14 years
