How large must each of the 2 payments be

Reference no: EM13298203

Nonannual compounding

a. You plan to make 3 deposits of $1,000 each, one every 6 months, with the first payment being made in 6 months. You will then make no more deposits. If the bank pays 5% nominal interest, compounded semiannually, how much would be in your account after 3 years?

Round your answer to the nearest cent.

b. One year from today you must make a payment of $6,000. To prepare for this payment, you plan to make 2 equal quarterly deposits, at the end of Quarters 1 and 2, in a bank that pays 5% nominal interest, compounded quarterly. How large must each of the 2 payments be?

Round your answer to the nearest cent.

Reference no: EM13298203

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