At the end of each year, a worker invests $12,000 into an account that draws 7%...

 

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At the end of each year, a worker invests $12,000 into an account that draws 7% interest. The worker makes every payment for the next 30 years. She could not do any investment in years 31, 32, and 33 since she lost her job but she resumed her investment in year 34. To catch up on the lost three years, she changed her strategy and started year 31 with $15,000 and increased it by $1,500 every year till the end of year 40. That is, she did $15,000 in 31, $16,500 in year 32, $18,000 in year 33 etc. till year 40, and then retired and cashed out, i. ii. Draw the cash flow diagram for this investment. How much money will be in the account at the end of 40 years? At the end of each year, a worker invests $12,000 into an account that draws 7% interest. The worker makes every payment for the next 30 years. She could not do any investment in years 31, 32, and 33 since she lost her job but she resumed her investment in year 34. To catch up on the lost three years, she changed her strategy and started year 31 with $15,000 and increased it by $1,500 every year till the end of year 40. That is, she did $15,000 in 31, $16,500 in year 32, $18,000 in year 33 etc. till year 40, and then retired and cashed out, i. ii. Draw the cash flow diagram for this investment. How much money will be in the account at the end of 40 years?

Answer rating: 100% (QA)

i The cash flow for this investment is shown below Year Investment Interest Balance 0 12000 840 128... View the full answer