Math Problem Statement
An individual earns an extra $2000 each year and places this money at the end of each year into an Individual Retirement Account (IRA) in which both the original earnings and the interest in the account are not subject to taxation. If the account has an annual interest rate of 10.2% compounded annually, how much is in the account at the end of 40 years? (Round your answer to the nearest cent.)
Solution
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Math Problem Analysis
Mathematical Concepts
Compound Interest
Future Value of an Annuity
Exponential Growth
Formulas
A = P × [(1 + r)^t - 1] / r
Theorems
Annuity Growth Formula
Suitable Grade Level
Grades 11-12 or College Level
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