We have been given that Tony wants to save $10000 in 6 years.
That means future value S = $10000
Time t= 6 years
Interest rate = 4% yearly = 0.04 yearly
n=12 months per year
Now we have to find monthly payment to recieve $10000 in 6 years. so we need to apply monthly payment formula which is
[tex] S=R(\frac{(1+\frac{r}{n})^{nt}-1}{\frac{r}{n}}) [/tex]
[tex] 10000=R(\frac{(1+\frac{0.04}{12})^{12*6}-1}{\frac{0.04}{12}}) [/tex]
[tex] 10000=R(\frac{(1+0.00333333333333)^{72}-1}{0.00333333333333}) [/tex]
[tex] 10000=R(\frac{(1.00333333333333)^{72}-1}{0.00333333333333}) [/tex]
[tex] 10000=R(\frac{1.27074187908-1}{0.00333333333333}) [/tex]
[tex] 10000=R(\frac{0.27074187908}{0.00333333333333}) [/tex]
[tex] 10000=R(81.2225637241) [/tex]
[tex] \frac{10000}{81.2225637241}=R [/tex]
[tex] 123.11849739=R [/tex]
which is approx $123.
Hence final answer is C) $123.
