Alison is currently 35 years old. on alison's 21 birthday, she started saving $2000 per year. she saved for 15 years and made her last deposit of $2000 on her 35th birthday. throughout this 15-year period, she earned 6% on her savings. for the next 30 years (ages 35-65), her money will grow at 3% interest. approximately, how much will she have in her savings account on her 65th birthday, that is, 30 years after making her last deposit? (hint: the answer requires two time value of money calculations.) group of answer choices
a. $35,000b. $55,000c. $110,000d. $135,000e. $175,000

The correct answer is C. $110,000

Explanation:

Alison´s Saving chart is attached.  

To get the final saving,  first we have to calculate how much Alison will earn making the deposits.  

Each year we have to add the deposit with the accumulated amount ( the first year will be 0), the we calculate the interest, remember to use the 6%.

At 35 years old, she stopped making the deposits and the interest changed,  we can use the chart or the following formula.  

The formula of interest is A=P (1+r)ⁿ

A=Final amount  

P= Principal (the amount accumulated in the previous years)

r= interest rate

n= time

A=49345 (1+0.03)^30

A=119,773

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