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Travis invests $10,000 today into a retirement account. he expects to earn 8 percent, compounded annually, on his money for the next 26 years. after that, he wants to be more conservative, so only expects to earn 5 percent, compounded annually. how much money will he have in his account when he retires 38 years from now, assuming this is the only deposit he makes into the account?

Respuesta :

Aliwohaish12
First calculate the future value at the end of 26 years at 8%
The formula is
A=p (1+r)^t
A future value?
P present value 10000
R interest rate 0.08
T time 26 years
A=10,000×(1+0.08)^(26)
A=73,963.532119168

After that use the formula again to calculate the future value for the rest years at 5%
A=73,963.532119168×(1+0.05)^(38−26)
A=132,827.88....answer

Hope it helps!

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