unfortunately, shannon doesn't have enough money in her account right now. she needs to make additional contributions at the end of each of the next three years to be able to pay for the repairs. her account currently has $5,000, which, along with her additional contributions, is expected to continue earning 9% annual interest. if she makes equal contributions each year, how large must each contribution be for shannon to have $9,000 after three years?

Her account currently has $5,000, which, coupled with her additional donations, is predicted to produce 9% annual interest for the foreseeable future.

Shannon wishes to have $9,000 after three years in her account.

The equal contributions will be an annuity.

The $5,000 already there will also grow at 6% for 3 years.

Expression is;

[tex]FV= [PV *(1 + i)^t ] + Contribution * Future Value Interest Factor Of Annuity, 3 years, 9 Percent[/tex]

Where, FV = Future value = $9,000

PV = Present Value = $5,000

i = interest rate = 9% = 0.09

and t = time period = 3 years

Now substituting the values in the equation we get,

9,000 = ( 5,000 * ( 1 + 9%)^3) + Contribution * 3.2781(refer to the attached image, marked with red ink)

9,000 = (5,000 * 1.29503) + Contribution * 3.2781

9,000 = 6,475.145 + Contribution * 3.2781

Contribution = (9,000 - 6,475.145) / 3.2781

Contribution = 2,524.855 / 3.2781

Contribution = $770.22

Hence, the answer is $770.22

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