Question

Joe Sullivan invests $9,000 at the end of each year for 20 years. The rate of interest Joe gets is 8% annually. Using the tables in the Business Math Handbook that accompanies the course textbook, determine the final value of Joe's investment at the end of the 20th year on this ordinary annuity.

Answer 1

Joe Sullivan invested 9000 dollars at the end of each year for 20 years.
THen the interest rate that he is receiving is 8% per year.
Let's solve for the total money he will receive for 20 years.
=> 9000 * 0.08 = 720
=> 9000 + 720 = 9720 dollars per year.
=> 9720 * 20 years = 194 400 dollars in 20 years