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Xavier and alex plan on retiring 27 years from today. at that time, they plan to have saved the same amount. javier is depositing $15,000 today at an annual interest rate of 5.2 percent. how will alex's deposit amount vary from javier's if alex also makes a deposit today, but earns an annual interest rate of 6.2 percent

Respuesta :

The amount by which Alex's deposit amount vary from Javier's if Alex also makes a deposit today, but earns an annual interest rate of 6.2 percent is $3381.39.

How to calculate the value?

We use the formula:

A=P(1+r/100)^n

where

  • A=future value
  • P=present value
  • r=rate of interest
  • n=time period.

Hence future value Javier will be:

=$15000*(1.052)^27

=$58,954.40

For Alex:

58,954.40=P*(1.062)^27

P=58,954.40/(1.062)^27

=$11618.61

Hence difference will be:

=15000 - 11618.61

= $3381.39

Learn more about interest on:

https://brainly.com/question/2294792

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