Problem $2-03$

a$.$ Someone in the $15$ percent tax bracket can earn $10$ percent annually on his investments in a tax$-$exempt IRA account. What will be the value of a $$18,000$

investment in $5$ years? $10$ years? $20$ years? You may use Appendix $C$ to answer the questions. Do not round intermediate calculations. Round your answers

to the nearest dollar.

in $5$ years: $

in $10$ years: $

in $20$ years: $

b$.$ Suppose the preceding $10$ percent return is taxable rather than tax$-$deferred and the taxes are paid annually. What will be the after$-$tax value of his $$18,000$

investment after $5,10,$ and $20$ years? Do not round intermediate calculations. Round your answers to the nearest dollar.

in $5$ years: $

in $10$ years: $

in $20$ years: $