If $8,000 is deposited every year for 12 years at 3.2% interest, what will the total amount be at the end?

To determine the total amount accumulated after consistently depositing $8,000 each year for 12 years at an annual interest rate of 3.2%, we utilize the Future Value of an Annuity formula. This formula accounts for the recurring nature of the deposits made at the end of each period and incorporates the effects of compound interest.

The formula for the future value of an annuity is:

[

FV = P \times \frac{(1 + r)^n - 1}{r}

]

where:

• (FV) is the future value of the annuity,

• (P) is the annual payment (the amount deposited each year),

• (r) is the annual interest rate (expressed as a decimal),

• (n) is the total number of deposits (the number of years).

Here, we have:

• (P = 8,000),

• (r = 3.2% = 0.032),

• (n = 12).

Now, plugging in the values:

1. Calculate ( (1 + r)^{n} ):

[

(1 + 0.032)^{12} \approx (1.