To accumulate $15,000 for a boiler in 10 years at 4% interest, how much should I save annually?

To determine how much should be saved annually to accumulate $15,000 in 10 years at an interest rate of 4%, we can use the formula for the future value of an annuity. The formula is:

[

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

]

where:

• ( FV ) is the future value of the annuity, which is $15,000 in this case,

• ( P ) is the annual payment (the amount to be determined),

• ( r ) is the annual interest rate (4% or 0.04), and

• ( n ) is the number of years (10).

We need to rearrange this formula to solve for ( P ):

[

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

]

Plugging in the values:

[

P = \frac{15000}{\left( \frac{(1 + 0.04)^{10} - 1}{0.04} \right)}

]

First, calculate ( (1 +