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Suppose you establish a sinking fund by putting $200 into an account now, followed by monthly payments into the account as follows: - $50 at the end of each month for 8 years. - followed by $150 at the end of each month for 6 more years. Given that the APR is 6% compounded monthly, how much will the accumulated amount be in 14 years? Round your final answers to the nearest dollar.

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Nelly Stracke
Nelly StrackeLv2
22 Apr 2018
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An insurance agent offers services to clients who are concerned about their personal financial planning for retirement. Knowing that you have taken MAT133Y5 at UTM, she asks you to consider the following two cases. Case 1: You are 25 years old. You start saving for your retirement right away, by putting $2000 a year into an annuity for 10 years (a total of 10 contributions). Note that after the 10 payments the money sits in the bank earning interest until you are 65. Case 2: You are 25 years old. You wait until you are 35 and then start saving for your retirement, by putting $2000 a year into an annuity, from age 35 to age 65 (a total of 30 contributions). Assume an effective annual rate of 7%, and suppose that deposits are made at the beginning of each year. Find the accumulated amount for each case. Give your answers to the nearest dollar.

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