CFA Practice Question

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CFA Practice Question

At the end of 15 years, you wish to have accumulated $500,000. You plan to accumulate this money by making annual deposits into a money market account paying 8% per year. All deposits will be made at the beginning of each year. How much must be deposited each year?

A. $17,050.72
B. $18,414.77
C. $15,787.70
Correct Answer: A

BGN, FV = $500,000; n = 15; i = 8%; CPT PMT = -$17,050.72

User Contributed Comments 6

User Comment
wundac Correct answer is B):
500000/[((1+0.08)^15)-1]/0.08 = 18414.77
magicchip Wundac, A is correct. Dont forget payments are at the beginning of the year.
Ratego Set your calc to bgn.And do remember to set it back to end when through!
rihilule Agree with magicchip and Ratego!
johntan1979 wundac... remember this name guys. He will be the top scorer this year.
tichas Correct answer is A.
BA11 gives u 17050.71525
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