Question

Using the R script, answer the following questions. Please show all works for full credit.
1. Suppose you invest $150,000 into your mutual fund account on January 1st, 2019.
a) [5 points] What would the account balance be at the end of June, 2019 if the account carries a rate of return of 2% every month?
b) [5 points] If you earn a 4% return in July and a 5% return in August, 2019, what would the account balance be at the end of August, 2019?

Answer 1

a) calculation of Account balance at the end of June:

Account balance= 150000*(1.02)^6

Account balance= $168924.36

b) calculation of Account balance at the end of August

Account balance= 168924.36*1.04.105= $184465.40

Account balance at the end of August= $184465.40