Respuesta :
The savings plan balance after 18 months is $3,730.38
What is an ordinary annuity?
An ordinary annuity means that periodic savings are made at the end of each period unlike an annuity due where payments are made at the beginning of each period.
To determine the savings plan balance after 18 months, we need to make use of the future value formula of an ordinary annuity provided below:
FV=monthly payment*(1+r)^N-1/r
FV=future value after 18 months=unknown
monthly payment=$200
r=monthly interest rate=5%/12=0.00416666666666667
N=number of monthly payments in 18 months=18
FV=$200*(1+0.00416666666666667)^18-1/0.00416666666666667
FV=$200*(1.00416666666666667)^18-1/0.00416666666666667
FV=$200*(1.07771621094479000-1)/0.00416666666666667
FV=$200*0.07771621094479000/0.00416666666666667
FV=$3,730.38
Find out more about future value of an ordinary annuity below:https://brainly.com/question/22100224
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