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A young graduate engineer wants to know the equivalent future worth if she invests a uniform...

A young graduate engineer wants to know the equivalent future worth if she invests a uniform series amount of $6,000 each year for the next 35 years in an individual retirement account (IRA). Assuming a 6% per year rate of return, she wants to calculate the total future compound amount of the IRA accumulation after 35 years.

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Answer #1

Explanation: To find the future value we use following formula Where, FV Future Value OR Amount at time n A - Regular Withdrawal Amount OR Regular Interest OR Regular Dividend OR Installment Amount n Number of period r Compound interest rate Given: Number of periods/years (n) 35 Rate of Interest (r)-6% Regular withdrawal (A) 6000 After substituting the values into the formula we have, i FV = 6000 * 6000 *(1+0.06)35 PV 0.06 FV-$668608.67923 The future value of annuity is $668608.67923.

the  total future compound amount of the IRA accumulation after 35 years is $668608.68

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