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7 . 1 4 . Saira Banu turns 1 5 today. Her elder sister, who is enrolled in engineering economics, has helped her appreciate the

7.14. Saira Banu turns 15 today. Her elder sister, who is enrolled in engineering
economics, has helped her appreciate the power of compounding in building up equity.
Saira decided to set aside the cash gift from her grandparents' trust at each birthday,
beginning the 16th and ending with the 55th. The trust provides a dollar gift ten times her
age. If her savings can earn an annually compounded interest rate of 10% per year, how
much will have accumulated on her 60th birthday? Though she does not save beyond the
55th birthday, the savings continue to earn compounded interest.
Answer: $178,947
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