Question

1)(a) Patty Stacey deposits $2800 at the end of each of 5 years in an IRA. If she leaves the money that has accumulated in the IRA account for 25 additional years, how much is in her account at the end of the 30-year period? Assume an interest rate of 10%, compounded annually. (Round your answer to the nearest cent.)
$

(b) Suppose that Patty's husband delays starting an IRA for the first 10 years he works but then makes $2800 deposits at the end of each of the next 15 years. If the interest rate is 10%, compounded annually, and if he leaves the money in his account for 5 additional years, how much will be in his account at the end of the 30-year period? (Round your answer to the nearest cent.)
$

(c) Does Patty or her husband have more IRA money?

PattyPatty's husband

2)

A sinking fund is established to discharge a debt of $60,000 in 20 years. If deposits are made at the end of each 6-month period and interest is paid at the rate of 8%, compounded semiannually, what is the amount of each deposit? (Round your answer to the nearest cent.)

Answer 1

Question-1

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for Patty Stacey

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PMT=2800

r=10%=0.1

t=5 years

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she leaves 17094.28 in the IRA account for 25 additional years,

p=17094.28

r=10%=0.1

t=25 years

.................... at the end of the 30-year period

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for  Patty's husband

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PMT=2800

r=10%=0.1

t=15 years

he leaves the money in his account for 5 additional years

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P=88962.94874

r=10%=0.1

t=5 years

.................. at the end of the 30-year period

so here Patty have more money at the end of the 30-year period

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Question-2

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PMT=?

r=8%=0.08

t=20 years

n=2 for semiannaual payment

PV=60000