You deposit $2000 each year into an account earning 4% interest compounded annually. How much will you have in the account in 20 years?

To calculate how much you will have in the account in 20 years with annual deposits of $2000, 4% interest compounded annually, we can use the **future value of a series formula**:

\[
A = P \times \frac{(1 + r)^n - 1}{r}
\]

Where:
- $ A $ is the future value of the account
- $ P $ is the annual deposit (\$2000)
- $ r $ is the annual interest rate (4% or 0.04)
- $ n $ is the number of years (20)

### Plugging in the values:

\[
A = 2000 \times \frac{(1 + 0.04)^{20} - 1}{0.04}
\]

Let's calculate that.

After 20 years of depositing $2000 annually into an account earning 4% interest compounded annually, you will have approximately **$59,556.16** in the account.

Would you like further details or explanations?

Here are 5 related questions for further exploration:
1. How would the total change if the interest rate increased to 5%?
2. What if the deposits were made monthly instead of annually?
3. How much would you need to deposit annually to reach $100,000 in 20 years at 4% interest?
4. What if the interest was compounded quarterly instead of annually?
5. How much interest will you have earned after 20 years?

**Tip:** The longer you leave your money in an account with compound interest, the more interest you'll earn, thanks to the power of compounding.

Discover how to calculate the future value of $2000 annual deposits into an account earning 4% interest compounded annually for 20 years. Using the future value of annuities formula, this example covers key financial concepts, exponential growth, and compound interest calculations. Suitable for Grades 10-12.

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