Answer:
Annual deposit= $593.94
Explanation:
Giving the following information:
They anticipate that the new digging machine will cost them $3,700. Since they would like to have cash ready for payment, how much should they deposit semi-annually in an account that will earn 3% per year compounded semi-annually to have the money available in 3 years?
FV= {A*[(1+i)^n-1]}/i
A= annual deposit
Isolating A:
A= (FV*i)/{[(1+i)^n]-1}
A= (3,700*0.015)/{(1.015^6)-1}= 593.94
