Question 1 A- A friend has an IRA with an APR of 5%. She started the IRA at age 30and deposits $1000 per month. How much will her IRA contain when she retires at age 65? Compare that amount to the deposits made over the time period. (In other words, whatis the difference between the amount in her IRA at age 65 and the amount she actuallycontributed from age 30 to 65?)
Question 1
A- A friend has an IRA with an APR of 5%. She started the IRA at age 30and deposits $1000 per month. How much will her IRA contain when she retires at age 65? Compare that amount to the deposits made over the time period. (In other words, whatis the difference between the amount in her IRA at age 65 and the amount she actuallycontributed from age 30 to 65?)
B- Say you need a $400,000 loan. Option 1 is a 30-year loan at an APR of 8%.Option 2 is a 15-year loan at an APR of 7.5%. First, compare the monthly payments andtotal amounts paid over the lifetime of the loan for each of the loan options. Next, discussthe pros and cons of each loan. You may assume that both loans are a fixed rate and havethe same closing costs.
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