Question
(Future value ) Selma and Patty Bouvier are twins, and both work at the Springfield DMV. They decide to save for retirement, which is 40
(Future value ) Selma and Patty Bouvier are twins, and both work at the Springfield DMV. They decide to save for retirement, which is 40 years away. They'll both receive an annual return of 6 percent on their investment over the next 40 years. Selma invests $2,500 per year at the end of each year only for the first 10 years of the 40-year period for a total of $25,000 saved. Patty doesn't start saving for 10 years and then saves $2,500 per year at the end of each year for the remaining 30 years for a total of $75,000 saved. How much will each of them have when they retire?
a. Selma invests $2,500 per year at the end of each year only for the first 10 years of the 40-year period. How much will Selma have 10 years from now?
Answer: $ ______ (Round to the nearest cent and use thousand separators.)
b. How much will Selma have when she retires 40 years from now?
Answer: $ ______ (Round to the nearest cent and use thousand separators.)
c. Patty doesn't start saving for 10 years and then saves $2,500 per year at the end of each year for the remaining 30 years. How much will Patty have when she retires 40 years from now?
Answer: $ ______ (Round to the nearest cent and use thousand separators.)
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