Mitch and Bill are both age 75. When Mitch was 25 years​ old, he began depositing ​$1400 per year into a savings account. He made deposits for the first 10​ years, at which point he was forced to stop making deposits.​ However, he left his money in the​ account, where it continued to earn interest for the next 40 years. Bill​ didn't start saving until he was 46 years​ old, but for the next 29 years he made annual deposits of ​$1400. Assume that both accounts earned an average annual return of 5​% ​(compounded once a​ year). Complete parts​ (a) through​ (d) below. At age 75, how much money does he have in his acct?

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Mitch and Bill are both age 75. When Mitch was

25

years​ old, he began depositing

​$1400

per year into a savings account. He made deposits for the first 10​ years, at which point he was forced to stop making deposits.​ However, he left his money in the​ account, where it continued to earn interest for the next

40

years. Bill​ didn't start saving until he was

46

years​ old, but for the next

29

years he made annual deposits of

​$1400.

Assume that both accounts earned an average annual return of

5​%

​(compounded once a​ year). Complete parts​ (a) through​ (d) below.

At age 75, how much money does he have in his acct?

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c. Compare the amounts of money that Mitch and Bill deposit into their accounts.
 
Mitch deposits
​$enter your response here
in his account and Bill deposits
​$enter your response here
in his account.
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