How much fund is used to set up an annuity

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Reference no: EM131785328

Question: Suppose a salesman invests his $12,500 bonus in a fund that earns 10.8%, compounded monthly. Suppose also that he makes contributions of $150 at the end of each month to this fund.

(a) Find the future value after 12½ years.

(b) If after the 12½ years, the fund is used to set up an annuity, how much will it pay at the end of each month for the next 10 years?

Reference no: EM131785328

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