Chapter5: The Time Value Of Money
Section: Chapter Questions
Problem 1P
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Question
A person wishes to deposit $5,000 per year in a savings account which earns interest of 8 percent per year compounded annually. Assume the first deposit is made at the end of this current year and additional deposita at the end of each following year. (a) To what sum will the investment grow at the time of the 10th deposit?
(b) How much interest will be earned?
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