SOLUTION: Eva wins $250,000 (after taxes) in the lottery and decides to invest half of it in a 5-year CD that pays 5.75% interest compounded semi-annually. She invests the other half in a m
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Question 1085129: Eva wins $250,000 (after taxes) in the lottery and decides to invest half of it in a 5-year CD that pays 5.75% interest compounded semi-annually. She invests the other half in a money market fund, a retirement account that averages 3.2% interest compounded quarterly over the 5-year period. How much money will she have altogether in the two accounts at the end of the 5-year period?
You can put this solution on YOUR website! 125000(1+.0575/2)^10. Divide the interest rate by 2 and make the exponent the number of compoundings over the 5 year interval. This is $165961.94
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125000(1+0.032/4)^20=$146595.51
That total is $312,557.45
