Hal Thomas, a 30-year-old college graduate, wishes to retire at age 65. To supplement other sources of retirement income, he can deposit $2,400 each year into a tax-deferred individual retirement arrangement (IRA). The IRA will earn a return of 13% over the next 35 years.

a.If Hal makes end-of-year $2,400 deposits into the IRA, how much will he have accumulated in 35 years when he turns

65?

b.If Hal decides to wait until age 40 to begin making end-of-year $2,400 deposits into the IRA, how much will he have accumulated when he retires 25 years later?