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A bank has three different types of accounts in which the interest rate depends on the amount invested. The ‘ordinary’ account offers a return of 6% and is available to every customer. The ‘extra’ account offers 7% and is available only to customers with $5000 or more to invest. The ‘superstar’ account offers 8% and is available only to customers

A bank has three different types of accounts in which the interest rate depends on the amount invested. The ‘ordinary’ account offers a return of 6% and is available to every customer. The ‘extra’ account offers 7% and is available only to customers with $5000 or more to invest. The ‘superstar’ account offers 8% and is available only to customers with $20 000 or more to invest. In each case, interest is compounded annually and is added to the investment at the end of the year. A person saves $4000 at the beginning of each year for 25 years. 

Calculate the total amount saved on the assumption.

Related Book For  answer-question

Income Tax Fundamentals 2013

31st Edition

Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill

ISBN: 9781285586618