Ben Watson found $25,000 lying on the sidewalk and decided to invest the money. He believes that
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Ben Watson found $25,000 lying on the sidewalk and decided to invest the money. He believes that he can earn a 10 percent rate (compounded annually) on his investment for the first four years, 12 percent for the following three years, and 15 percent for the following five years. REQUIRED:
a. How much money will Ben have at the end of 4 years, 7 years, and 12 years?
b. If someone offered to pay him $36,000 at the end of 4 years for the $25,000, should he accept? Why or why not?
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