# Homework Help: Need an formula/equation for this scenario

1. Dec 18, 2008

### gwanun

1. The problem statement, all variables and given/known data
I invest 600 every year for 8% compound interest
for etc. first yr 600* 1.08= 648

2nd yr
600+648= 1248
1248*1.08= 1347.84

3rd yr
1347.84+600=1947.84
1947*1.08=2102.74

and so on

2. Relevant equations

compounded interest formula is

r is the annual rate of interest as a decimal (5% means r = 0.05)

n is the number of years you leave it on deposit

A is how much money you've accumulated after n years, including interest.

If the interest is compounded once a year:

A = P(1 + r)power of n

3. The attempt at a solution

i attempted A= nP(1+r)power of n

but there's some difference in the answers im getting

2. Dec 18, 2008

### gwanun

nvm i got it

P = sum deposited at the end of each year (beginning one year from when the annuity "starts")

r = the interest rate, as a decimal (5%, for example, is r = 0.05)

n = number of years the annuity has run

N = total amount accumulated at the end of n years.

N = (P/r)( (1 + r)n - 1)