Question: Gabe would like to accumulate $ 9 , 0 0 0 at the end of 8 years by making deposits at the beginning of each

Gabe would like to accumulate $9,000 at the end of 8 years by making deposits at the beginning of each year for 8 years. His first deposit will be 700 and each subsequent deposit will increase by k%. You are also given that Gabe can invest at an annual effective interest rate of i =4%.(i) By considering the present value at t =0 show that 9000v8=700a8,i and that 5876.21=700a7,i where v =(1+i)1 and i is a function of i and k.(ii) Given that i=0.04346, show that k =8.725.

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