The future value of the savings account, after 18 years when it was withdrawn to help pay for Lois Martin's college expenses, would be <u>$5,816.85</u>.
<h3>How are the future values determined?</h3>
The future values of the savings account are calculated in two installments.
The first installment is for 10 years when the account earns 6% compounded semiannually.
Using the future value after 10 years, the second installment is for 8 years when the account earns 6% compounded quarterly.
Future values can be determined using the future value formula or an online finance calculator, as follows:
<h3>Data and Calculations:</h3><h3>Investment of $2,000 for 10 years:</h3>
N (# of periods) = 20 (10 years x 2)
I/Y (Interest per year) = 6%
PV (Present Value) = $2,000
PMT (Periodic Payment) = $0
<u>Results:</u>
FV = $3,612.22
Total Interest $1,612.22
<h3>Investment of $3,612.22 for 8 years:</h3>
N (# of periods) = 32 (8 years x 4)
I/Y (Interest per year) = 6%
PV (Present Value) = $3,612.22 ($2,000 + $1,612.22)
PMT (Periodic Payment) = $0
<u>Results:</u>
FV = $5,816.85
Total Interest $2,204.63
Thus, the value of the account after 18 years was <u>$5,816.85</u>.
Learn more about future values at brainly.com/question/989421
#SPJ1
