jenna jetson is willing to give $220 quarterly for 5 years and a half to the children charity fund. But jerold jetson wants to give a lump. If the interest rate is estimated to be at 3.25%, what is the amount of the lump sum?
+23254 Formula to find the future value: F = P·( (1 + i)^n - 1 ) / i
F = future value P = payment = 220 n = number of payments = 5.250 x 4 = 22
i = interest rate per period (as a decimal) = 0.0325/4 = 0.008125
F = 220·( (1 + 0.008125)^22 - 1 ) / 0.008125 = 5276.17
