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Lindsay is 29 years old and has a new job in web development. She wants to make sure that she is financially sound by the age of 55, so she plans to invest the same amount into a retirement account at the end of every year for the next 26 years.(a) Construct a data table in Excel that will show Lindsay the balance of her retirement account for various levels of annual investment and return. If Lindsay invests $10,000 at return of 6%, what would be the balance at the end of the 26th year? Note that because Lindsay invests at the end of the year, there is no interest earned on the contribution for the year in which she contributes. Round your answer to a whole dollar amount.

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Answer:

Using a table to calculate the balance, we get that at the end of the 26th year is M=$45,494.

Step-by-step explanation:

Interest = 0.06*Initial balance

Final balance = Initial balance + Interest

Year Initial balance Interest Final balance    

0   -              -             10,000  

1   10,000    600    10,600  

2   10,600    636    11,236  

3   11,236    674    11,910  

4   11,910    715    12,625  

5   12,625    757    13,382  

6   13,382    803    14,185  

7   14,185    851    15,036  

8   15,036    902    15,938  

9   15,938    956    16,895  

10   16,895    1,014    17,908  

11   17,908    1,075    18,983  

12   18,983    1,139    20,122  

13   20,122    1,207    21,329  

14   21,329    1,280    22,609  

15   22,609    1,357    23,966  

16   23,966    1,438    25,404  

17   25,404    1,524    26,928  

18   26,928    1,616    28,543  

19   28,543    1,713    30,256  

20   30,256    1,815    32,071  

21   32,071    1,924    33,996  

22   33,996    2,040    36,035  

23   36,035    2,162    38,197  

24   38,197    2,292    40,489  

25   40,489    2,429    42,919  

26   42,919    2,575    45,494  

If we calculate with the compound interest formula we have:

[tex]FV=C(1+i)^n=10,000(1.06)^{26}=10,000*4.5494=45,494[/tex]

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