Jessica deposits her $2,500 bonus cheque into the bank at the end of 2015.At the end of 2016,she deposits another bonus cheque,which is double the amount of last year's cheque.Given that the interest rate is 5%,what is the total future value of these two bonuses at the end of 2017?

Question

Quizplus · Accepted Answer

The future value of the first deposit is $2,500 * (1 + 0.05)^2 = $2,756.25. The second deposit is $5,000 * (1 + 0.05) = $5,250. The total future value is $2,756.25 + $5,250 = $8,006.25.

Jessica Deposits Her $2,500 Bonus Cheque into the Bank at the End