Question

You wish to deposit $2000 into account for use when you retire assume that you have just turned 25 years old and you plan to withdraw the money when you turn 65 years old assume that these conditions will not change from now until you retire

Answer 1

To calculate the amount of money you will have when you retire, you can use the formula for compound interest. If you deposit $2000 at age 25 and plan to withdraw it at age 65, you will have approximately $19,568.24 when you retire.

Step-by-step explanation:

To calculate the amount of money you will have when you retire, you can use the formula for compound interest. Let's assume you deposit $2000 at age 25 and plan to withdraw it at age 65.

Using the formula A = P(1 + r/n)^(nt), where A is the final amount, P is the principal amount, r is the annual interest rate (as a decimal), n is the number of times interest is compounded per year, and t is the number of years, we can calculate the amount as follows:

A = 2000(1 + 0.06/1)^(1*40)

A = 2000(1.06)^40

A ≈ $19,568.24

So, if you deposit $2000 and leave it untouched until you turn 65, you will have approximately $19,568.24 when you retire.