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If an account is increasing at a rate of 2.1% compounded monthly, what is the exact value of i in the following future value ordinary annuity formula? F V = P (StartFraction (1 + i) superscript n Baseline minus 1 over i EndFraction) a. 2.1 b. StartFraction 0.021 over 100 EndFraction c. StartFraction 0.021 over 12 EndFraction d. StartFraction 0.21 over 12 Endfraction Please select the best answer from the choices provided A B C D

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Answer:

That would be C on edge

Step-by-step explanation:

The value of i in the ordinary annuity formula is 0.021 / 12.

What is the ordinary annuity formula?

An ordinary annuity can be described as a series of payment made at a specific time period.

The formula used to determine the future value of the  ordinary annuity is:

FV = P (1 + r) nm

Where:

  • FV = Future value
  • P = Present value
  • R = interest rate = 2.1 / 12
  • m = number of compounding = 12
  • N = number of years

i = 0.021 / 12

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