Problema Solution
An IRA has $16,000 in it, and the owner decides not to add any more money to the account other than the interest earned at 3% compounded daily. how much will be in the account 31 from now when the owner reaches retirement age?
Round to the nearest cent. Use a 365 day year.
Answer provided by our tutors
P = $16,000, r = 3%/365, n = 31*365 = 11315
So
A = P(1+r)^n =$16,000*(1+ 3%/365)^11315 = $40,550.60
So it will be $40,550.60 31 years from now