At age 25, James, rhinkin ahead, deposits $2500 into a retirement account with an average annual interest rate of 11%.
A) Find Jeames' age when his investment is wirth ten times its original value.
b) If James had funded this account at age 18, how much money would give same result as depositing $2500 at age 25? Round to nearest dollar.
c) Suppose the $2500 he deposited when he was 25 grew to $25,000 when he was 40. whatcwas average annual return on his investment? Round answer to nearest tenth of a percent.
At age 25, James, rhinkin ahead, deposits $2500 into a retirement account with an average annual interest rate of 11%.
A) Find Jeames' age when his investment is wirth ten times its original value.
b) If James had funded this account at age 18, how much money would give same result as depositing $2500 at age 25? Round to nearest dollar.
c) Suppose the $2500 he deposited when he was 25 grew to $25,000 when he was 40. whatcwas average annual return on his investment? Round answer to nearest tenth of a percent.
a) James will have 10 times his original deposit in just over 22 years @ 11% comp.annually. So, James will be: 25 + 22 =47 years old.
b) At 18 years of age, James would have had to deposit: $1,204.15 to get the same amount at 47.
c) In order for James to get $25,000 at age 40, on the same $2,500 investment, he would have to earn an average annual interest rate of: 16.59% comp. annually.
