Rosie Cheeks plans to deposit $1,000 per year in her account for each of the next 4 years. Thereafter, she expects to deposit $2,000 per year for another 4 years. All deposits are made at year end. Interest rates are expected to be 12% for the next 2 years, and 8% thereafter. Interest is compounded annually.

A) Show that she will have saved $15,206.21 at the end of 8 years.

B) What lump sum payment would have to be deposited today to accumulate the same bank balance at the end of year 8? Answer: $7,639.10