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You toke your first job and decided to start saving right away for your retirement since you have taken EGR 303 in the college and
You toke your first job and decided to start saving right away for your retirement since you have taken EGR 303 in the college and you know compounding is very important! You put $5,000 per year into the company's 401(k) plan, which averages 8% interest per year. Five years later, you move to another job and start a new 401(k) plan. You never get around to merging the funds in the two plans. If the first plan continued to eam interest at the rate of 8% per year for 40 years after you stopped making contributions, how much is the account worth? (a) Draw a cash-flow diagram for this situation. 6) Can you buy a house that worths $400,000 with this account
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