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A small business owner contributes $2,000 at the end of each quarter to a retirement account...

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Advance Math

A small business owner contributes $2,000 at the end of eachquarter to a retirement account that earns 10% compoundedquarterly. (a) How long will it be until the account is worth atleast $150,000? (Round your answer UP to the nearest quarter.) 43quarters (b) Suppose when the account reaches $150,000, thebusiness owner increases the contributions to $4,000 at the end ofeach quarter. What will the total value of the account be after 15more years? (Round your answer to the nearest dollar.) $

Answer & Explanation Solved by verified expert
4.2 Ratings (503 Votes)
Ordinary Annuity If the monthly payment made at the end of the every quarter then we can use the ordinary annuity formula We can use the formula for finding the future value as below FV P x 1 rn nt1 rn Here FV future value 150000 P Cash flow per period 2000 r rate of interest    See Answer
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