Hassnein recently deposited $27,000 in a savings account paying a guaranteed interest rate of 5.5 percent for the next 10 years. Hassnein expects his marginal tax rate to be 22.00 percent for the next ten years and will withdraw enough cash every year to pay the tax on the interest he earns.

Required:

1. How much interest will he earn after-tax for the first year of his investment?
2. How much interest will he earn after-tax for the second year of his investment?
3. How much will he have in the account after 4 years?
4. How much will he have in the account after 7 years?