What will natasha bank balance be at the end of year eight

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Reference no: EM131962514

Natasha plans to deposit $4,000 per year in her account for each of the next 4 years. Thereafter, she expects to deposit $1,500 per year for another 4 years. All deposits are made at year-end. Interest rates are expected to be 8 percent for the next 2 years, and 11 percent thereafter. Interest is compounded annually.

(a) What will Natasha's bank balance be at the end of year 8?

(b) How much would Natasha have to deposit as a lump sum today in order to accumulate the same bank balance at the end of year 8?

Reference no: EM131962514

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