Question

ting Find the final amount (rounded to the nearest dollar) in each e retirement accounts in which the rate of return on the account of these shoo 9, $400 per month invested at 4%, compounded monthly, for 10 chae over time. (Se Ex ears, then $600 per month invested at 6%, compounded monthly, for 10 years.

Answer 1

First 10 years i = 0.04/12 = 0.0033333 ellipsis n = 10 times 12 = 120 amount after a 10 years = 400 times ((1.003333)^120 - 1)/ 0.003333 = 58,898.679 $ this will accumulate for another 10 years at 6 % pa compounded monthly i = 0.06/12 = 0.005 n = 120 amount of first investment = 58,898.679 (1.005)n 120 = 107,160.00 $ amount of 2^nd investments = 600(1.005^n 120 - 1)/0.005 = 98,327.60 $ total investment = 107,160 + 98327.60 = 205,484.66 $