omework: Homework 3 ore: 0 of 10 pts 10 of 22 (1 complete) HW Score: 0%,0 ol 220

Question

omework: Homework 3 ore: 0 of 10 pts 10 of 22 (1 complete) HW Score: 0%,0 ol 220 p 6-12 (similar to) EQuestion Help Future value of an annuity) Upon graduating from college 35 years ago, Dr. Nick Riviera was already planning for his retirement Since then, he has made deposits nto a retirement fund on a semiannually basis in the amount of $1,000. Nick has just completed his final payment and is at last ready to retire. His retirement fund as earned 6 percent compounded semiannually. Use five decimal places for the periodic interest rate in your calculations a. How much has Nick accumulated in his retirement account? b. In addition to this, 20 years ago Nick received an inheritance check for $15,000 from his beloved uncle. He decided to deposit the entire amount into his retirement fund. What is his current balance in the fund? a. The amount Nick has accumulated in his retirement account is (Round to the nearest cent.) Enter your answer in the answer box and then click Check Answer heck Answo parts Clear All

Explanation / Answer

Part 1:

PMT = 1,000

N = 35 * 2 = 70

PV = 0

I = 6%/ 2 = 3%

Using Financial Calculator:

FV = 230,594.06

Part 2:

PMT = 0

N = 20 * 2 = 40

PV = -15,000

I = 6%/ 2 = 3%

Using Financial Calculator:

FV = 48,930.57

Part C:

Current Balance = 230,594.06 + 48,930.57

Current Balance = 279,524.63

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