Question

After 10 years, you will have approximately $________?

(Round to the nearest cent, as needed .)

Answer 1

$103,002.83

Explanation:

You want the amount of an ordinary annuity earning 5.5% interest compounded once per year for 10 years if the annual deposit is $8000.

Annuity formula

The amount is found by evaluating the formula with the given values substituted for the variables.

A = 8000((1 +0.055/1)^(1·10) -1)/(0.055/1) =8000(1.055^10 -1)/0.055

A ≈ 103,002.83

The accumulated amount is $103,002.83.