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You are hoping to buy a house in the future and recently received an inheritance of ?$20,000. You intend to use your inheritance as a down payment on your house.
a. If you put your inheritance in an account that earns 7 percent interest compounded? annually, how many years will it be before your inheritance grows to ?$34,000??
b. If you let your money grow for 10.5 years at 7 percent?, how much will you? have?
c. How long will it take your money to grow to ?$34,000 if you move it into an account that pays 4 percent compounded? annually? How long will it take your money to grow to ?$34,000 if you move it into an account that pays 13 percent??
d. What does all this tell you about the relationship among interest? rates, time, and future? sums?
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