My Math Forum Future value: what's wrong here?

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 February 16th, 2014, 01:07 PM #1 Newbie   Joined: Feb 2014 Posts: 2 Thanks: 0 Future value: what's wrong here? "Thirteen years ago, you deposited $2,400 into an account. Eight years ago, you added an additional$1,000 to this account. You earned 8 percent, compounded annually, for the first 5 years and 5.5 percent, compounded annually, for the last 8 years. How much money do you have in your account today?" 2400(1.0^5+3400(1.055)^8 is the formula I'm running and coming up with $8744.32 for the answer, but that's not anywhere near the choices of: a.$4,666.67 b. $4,717.29 c.$5,411.90 d. $6,708.15 e.$6,946.59 What am I doing wrong? I have run my equation several times with special attention to order of operations and still getting same result
February 16th, 2014, 01:18 PM   #2
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Re: Future value: what's wrong here?

Quote:
 Originally Posted by zniets "Thirteen years ago, you deposited $2,400 into an account. Eight years ago, you added an additional$1,000 to this account. You earned 8 percent, compounded annually, for the first 5 years and 5.5 percent, compounded annually, for the last 8 years. How much money do you have in your account today?" 2400(1.0^5+3400(1.055)^8 is the formula I'm running and coming up with $8744.32 What am I doing wrong? I'd definitely like you to be my banker! The first bit of your calculation is correct: after 5 years you have 2400*(1.0^5. But, then you've added$3400 and started paying interest on that.

,

### you have 2400 in your account and

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