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14. Sequences & Series
14. Sequences & Series / Series / Problem 7
Problem 7

Imagine you set aside dd dollars at the start of each month into a savings account that offers a monthly interest rate of ii, where ii is the annual interest rate divided by 1212 (for example, if the annual rate is 3.6%3.6\%, then i=0.03612=0.003i = \(\frac{0.036}{12}\) = 0.003). After the first month, your savings include your initial deposit plus the next deposit with interest applied, totaling d+d(1+i)d + d(1+i). Extending this pattern, the total amount in your account after nn months is Sn=d+d(1+i)+d(1+i)2++d(1+i)n1S_{n}=d+d(1+i)+d(1+i)^2+\(\cdots\)+d(1+i)^{n-1}. Find the total amount in your savings account after 55 years (6060 months) if you deposit $300\$300 each month and the monthly interest rate is 0.15%0.15\%.