Question

You are scheduled to receive $17,000 in two years. When you receive it, you will invest it for six more years at 9.75 percent per year. How much will you have in eight years?

Answer 1

Answer: $29,708.18 in eight years.

Explanation:

Amount received in two years = $17,000

Interest rate received per year = 9.75%

Amount received in eight years,

here we are using formula for calculating amount received after eight years are as follows:

A = $P(1+ \frac{r}{100}) ^{n}$

  = $17000(1+ \frac{9.75}{100}) ^{6}$

  =  $17000(1+ 0.0975) ^{6}$

  = 17000 (1.7475402)

  = 29708.18 ⇒ this much a person can earn in eight years.