document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=1130371>Question 1130371</A>: <I><SPAN STYLE=\"word-break: break-all;\"> At the age 18 you start to work for a company and are offered two rather fanciful retirement options. <BR>\n" );
document.write( "Retirement 1 option: When you retire, you will be paid a lump sum of $15,000 for each year of service<BR>\n" );
document.write( "Retirement 2 option: When you start to work, the company will deposit $10,000 into an account that pays 9.6% interest compounded monthly. When you retire, the account will be closed and the balance is given to you.<BR>\n" );
document.write( "(a) Which retirement option is more favorable if you retire at age 65?<BR>\n" );
document.write( "(b) Which retirement option is more favorable if you retire at age 55?\r<BR>\n" );
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document.write( "Please show me how you get the answers, thank you.<BR>\n" );
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document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #753237 by </B><A HREF=/tutors/aboutme.mpl?userid=VFBundy><B>VFBundy(438)</B></A><img src=\"/images/stars/stars-10.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=VFBundy><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/cgi-bin/show-face.mpl?user=VFBundy><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=753237\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> This is the formula for compound interest:<BR>\n" );
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document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=N=P%281%2Br%2Fn%29%5Ent ALIGN=MIDDLE  ALT=\"N=P%281%2Br%2Fn%29%5Ent\"   DISABLED_style= \"max-width:90%; height:auto;\" ><BR>\n" );
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document.write( "N is the new amount.<BR>\n" );
document.write( "P is the principal amount.<BR>\n" );
document.write( "r is the annual interest rate.<BR>\n" );
document.write( "n is how often the interest is compounded per year.<BR>\n" );
document.write( "t is the number of years.<BR>\n" );
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document.write( "Option 1:<BR>\n" );
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document.write( "At age 65 (47 years service): 47 * $15,000 = $705,000<BR>\n" );
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document.write( "At age 55 (37 years service): 37 * $15,000 = $555,000<BR>\n" );
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document.write( "Option 2:<BR>\n" );
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document.write( "At age 65 (47 years service):<BR>\n" );
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document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=N=10000%281%2B0.096%2F12%29%5E%2812%2A47%29 ALIGN=MIDDLE  ALT=\"N=10000%281%2B0.096%2F12%29%5E%2812%2A47%29\"   DISABLED_style= \"max-width:90%; height:auto;\" > = $894,829.12<BR>\n" );
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document.write( "At age 55 (37 years service):<BR>\n" );
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document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=N=10000%281%2B0.096%2F12%29%5E%2812%2A37%29 ALIGN=MIDDLE  ALT=\"N=10000%281%2B0.096%2F12%29%5E%2812%2A37%29\"   DISABLED_style= \"max-width:90%; height:auto;\" > = $343,934.91<BR>\n" );
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document.write( "So, at age 65 (47 years service), Option 2 is best.  At age 55 (37 years service), Option 1 is best. </SPAN>\n" );
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