Question

Shirley adds $2,000 to her savings on the last day of each year. Shawn adds $2,000 to his savings on the first day of each year. They both earn an 8% rate of return. What is the difference in their savings account balances at the end of 35 years

Answer 1

Explanation:

Shirley:-

Savings account balance after 35 years of CHRISTIE = 2000×(1.08)^35

= $31570.688

Shawn:-

Savings account balance after 25 years of Shawn = 2000 + 2000×(1.08)^34

= 2000 + 27380.2672

=$29380.2672

the difference in their savings account balances at the end of 35 years = $31570.6885 - $29380.2672

= $2190.4212