Answer:
rate of 0.000171716533316905 = 0.017% daily
Explanation:
we need to solve for the rate of an annuity for 19 years with daily deposits of 75 dolllars to yield a principal of 1,000,000 dollars
365 days x 19 years = 6,935 days
we use goal seek on excel as follow:
on A1 we write 0.01 this will be a placeholder for the rate
then on A2 we write =FV(A1;6935;75)
then with goal seek we definethat we want A2 equal to 1,000,000 changing A1 (rate)
which give us:
0.000171717 = 0.017% per day to achieve the goal:
[tex]C \times \frac{(1+r)^{time} -1}{rate} = FV\\[/tex]
C 75
time 6935
rate 0.000171717
[tex]75 \times \frac{1-(1+0.000171716533316905)^{-6935} }{0.000171716533316905} = FV\\[/tex]
FV $999,999.9999
