Your brother is 25 years old today and is planning to retire at age 65. He will start working next year and his starting salary will be $50,000. To save for his retirement, he plans to make annual contributions to a retirement account. He will make his first contribution of $5,000 next year on his 26th birthday. Since he expects his salary to increase at a rate of 6% per year as long as he works, he will increase his yearly contributions by 6% as well, until (and including) the year he reaches the age of 65. Assume that the interest rate is 7%. Questions 15 and 16 relate to this problem.

15. The present value (at age 25) of your brothers retirement savings is _________ .

A) $66, 658.54 B) $140,300.63 C) $156,557. 92 D) $175,639.47 E) $180,669.52

16. Your brother will have and amount of ___________ in his savings account when he reaches the age of 65.

A) $2,100,925.87 B) $2,630,105.84 C) $1, 998175.50 D) $2,528,437.49 E) $2,344,369.97