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Essay text:
How much will she have in the account at the end of the seventh year?
A.
Traditional method of finding the Future Value:
FV end of year 1 = $33,000+0.10($33,000) = $36,300
FV end of year 2 = $33,000+0.10($36,300) = $39,930
FV end of year 3 = $33,000+0.10($39,930) = $43,923
FV end of year 4 = $33,000+0.10($43,923) = $48,315.30
FV end of year 5 = $33,000+0.10($48,315.30) = $53,146.83
FV end of year 6 = $33,000+0.10($53,146.83) = $58,461.513
FV end of year 7 = $33,000+0.10($58,461.513) = $64,307.6643
or using the FV formula to find the Future Value:
FV=PV(1.0+i)n
FV=$33,000(1.0 + 0.10)7 = $33,000(1...
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