Alysha plans to invest $4000 in an equity fund every year end beginning this year. The...

Alysha plans to invest $4000 in an equity fund every year end beginning this year. The expected annual return on the fund is 15 percent. How much would she expect to have at the end of 16 years?

A. $222870

B. $194322

C. $190322

D. $260300

Solutions

Expert Solution

Future value of an ordinary annuity = P{[(1 + r)^n - 1] / r}

Future value of an ordinary annuity = $4,000{[(1 + 0.15)^16 - 1] / 0.15}

Future value of an ordinary annuity = $222,870

jeff jeffy answered 2 years ago

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