Question

A woman decides to invest $5000 in an IRA CD at the end of each year for 10 years. If she makes these payments and the certificates all pay 6%, compounded annually, how much will she have at the end of the 10 years?

Answer 1

`\begin{gathered} P=\text{ \$5000},\text{ annuity} \\ i=6\text{ \%= 0.06, annually} \\ t=10\text{ years} \\ F=\text{?} \\ F=P(((1+i)^t-1)/(i)) \\ F=5000(((1+0.06)^(10)-1)/(0.06)) \\ F=65903.97 \\ \text{She will have \$65903.97 at the end of 10 years} \end{gathered}`