Answered

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An engineering graduate starts a new job at $68,000 per year. Her
investments are deposited at the end of the year into a mutual fund
that earns a nominal interest rate of 5% per year with quarterly
compounding. How much money will be in the account immediately
after she makes the last deposit?
(a) She makes $4000 annual deposits for the next 40 years.
(b) She makes the $4000 deposits for 10 years, then stops all
investments for the next 10 years, and then resumes deposits of $6000
per year for the next 20 years.

Sagot :

Answer:

Explanation:

Effective Annual Rate=(1+r)^n-1 Here=r=5/4=1.25% per quarter EAR=(1.0125^4)-1 5.09% (a)..

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