Homework Answers
FV = C * [(1+r)^n - 1]/i
FV = 1000*[(1+0.04)^20 - 1/0.04]
FV = 1000*(2.191123-1)/0.04
FV = 1191.123/0.04
FV in John's hand at the end of 20 years = $29778.079
AMOUNT IN DAVIDS AFTER 10 YEARS = 2000*((1+0.04)^10-1)/0.04
= 2000*0.480244/0.04
=$24012.21
Amount in David account at the end of 20 years = PV after 10 years *(1+r)^n
= 24012.21*(1+0.04)^10
= $35543.94
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