Help me on number problem 4 please
1 answer:
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We have been given that miss Roxanne is 25 years old and she puts 1800 dollars per quarter that returns 6% interest.
(a) We need to figure out how much will be in the account when she turns 65 years old. When she turns 65 years old, the number of years during which she made deposits would be 40. Since she made quarterly deposits. She made a total of 160 deposits. We can now figure out the final amount in the account using future value of annuity formula.
We have the values P=1800, r=6/4% = 1.5% = 0.015 and n=160.
Therefore, the amount in the account would be:
Therefore, miss Roxanne will be 1179415.39 dollars in her account when she turns 65 years old.
(b) In this part we need to figure out the total amount she deposited.
The total amount she deposited would be .
(c) We can find the interest earned by subtracting her contribution from the answer of part (a).
Interest earned =
Simple equation and only requires one step to solve. Remember, a number and a variable juxtaposed means multiplications.
One step? I know. It seems more because I was slowing down the calculations for you so could understand everything happening. For someone who can do this in their sleep it would, for them, take one step.