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Theo is depositing $1,300 today in an account with an expected rate of return of 8.1 percent. If he deposits an additional $3,200 two years from today, and $4,000 three years from today, what will his account balance be ten years from today

Respuesta :

Answer:

$15,699.54

Explanation:

The computation of the account balance after 10 years from today is shown below:

= Future value of amount deposited today × (1 + interest rate)^number of years +   Future value of amount deposited two years × (1 + interest rate)^number of years + Future value of amount deposited three years × (1 + interest rate)^number of years

= $1,300 Ă— (1 + 8.1%)^10 + $3,200 Ă— (1 + 8.1%)^8 + $4,000 Ă— (1 + 8.1%)^7

= $2,832.70 + $5,966.99 + $6,899.85

= $15,699.54

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