Question

IAn Individual Retirement Account (IRA) has $22,000 in it, and the owner decides not to add any more money to the account other than interest earned at 8%compounded daily. How much will be in the account 29 years from now when the owner reaches retirement age?There will be in the account.(Round to the nearest cent. Use a 365 day year.)

Answer 1

Given:

$\begin{gathered} \text{Principal (P)= \ 22000} \\ \text{Rate of interest= 8\%} \\ n=29\text{ years} \end{gathered}$$\begin{gathered} \text{Amount in the account after 9 years=}P(1+\frac{r}{365})^{365\times n} \\ =22000(1+\frac{8}{100\times365})^{365\times29} \\ =22000(1+0.0002)^{10585} \\ =22000(8.3044) \\ =\text{ \ 182696}.80 \end{gathered}$

Amount in the account after 29 years is $182696.80