For Exercises 37 − 40 , note the following information: An Individual Retirement Account (IRA) is an account in which the server does not pay tax on the amount deposited but also is not allowed to withdraw the money until retirement. (The server pays income tax at that point, but his or her tax bracket is much lower then.) At age 27, Lauren Johnson deposited $1000 into an IRA, in which it earns 7 7 8 % compounded monthly. a. What will be worth when she retires at 65? b. How much would the IRA be worth if Lauren did not set it up until she was 35?
For Exercises 37 − 40 , note the following information: An Individual Retirement Account (IRA) is an account in which the server does not pay tax on the amount deposited but also is not allowed to withdraw the money until retirement. (The server pays income tax at that point, but his or her tax bracket is much lower then.) At age 27, Lauren Johnson deposited $1000 into an IRA, in which it earns 7 7 8 % compounded monthly. a. What will be worth when she retires at 65? b. How much would the IRA be worth if Lauren did not set it up until she was 35?
Solution Summary: The author explains how to find the future value at the age of 65 years for the given condition.
For Exercises
37
−
40
, note the following information: An Individual Retirement Account (IRA) is an account in which the server does not pay tax on the amount deposited but also is not allowed to withdraw the money until retirement. (The server pays income tax at that point, but his or her tax bracket is much lower then.)
At age 27, Lauren Johnson deposited $1000 into an IRA, in which it earns
7
7
8
%
compounded monthly.
a. What will be worth when she retires at 65?
b. How much would the IRA be worth if Lauren did not set it up until she was 35?
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