Sadie's parents opened a college fund for her when she was born and on her 18th birthday (i.e., after 18 years) the balance in the fund was $92,575.80. The fund was an ordinary annuity where they made monthly deposits. It had an interest rate of 2.62% compounded monthly.
(part a - 8 pts)
Find the amount of the monthly deposit that Sadie's parents put into the annuity. Include units and round to the nearest cent.
Sadie's parents made a monthly deposit of
into her college fund.
(part b - 8 pts)
Complete the following. Include units and be accurate to the nearest cent.
Over the 18 years, Sadie's parents deposited a grand total of
into the college fund and all together they earned a total of
in interest.
(part c - 4 pts)
When Sadie receives the college fund on her 18th birthday, she decides to immediately invest half of it into a 2-year CD that pays 2.1% simple interest. She computes that she will earn
in interest from this investment (include units and round to 2 decimal places).