Answer:
the numbers are missing, so I looked for similar questions:
You are graduating from college at the end of this semester and have decided to invest $5,000 at the end of each year into a Roth IRA, (which is a retirement investment account that grows tax free and is not taxed when it is liquidated) for the next 45 years. If you earn 8 percent compounded annually on your investment of $5,000 at the end of each year, how much will you have when you retire in 45 years? How much will you have if you wait 10 years before beginning to save and only make 35 payments into your retirement account?
We have to determine the future value of an annuity:
FV = annual contribution x FV annuity factor
annual contribution = $5,000
FV annuity factor, 45 periods, 8% = 386.50562
FV = $5,000 x 386.505662 = $1,932.528
if you wait 10 years before starting to save, then the future value will be:
FV = annual contribution x FV annuity factor
annual contribution = $5,000
FV annuity factor, 45 periods, 8% = 172.3168
FV = $5,000 x 172.3168 = $861,584
