Today is January 1. Starting today,Sam is going to contribute $140 on the first of each month to his retirement account. His employer contributes an additional 50% of the amount contributed by Sam. If both Sam and his employer continue to do this and Sam can earn a monthly rate of ½ of 1 percent,how much will he have in his retirement account 35 years from now?

Question

Quizplus · Accepted Answer

The correct answer is E.The total amount contributed by Sam in 35 years is $140 * 12 * 35 = $58,800. The total amount contributed by his employer is $58,800 * 50% = $29,400. The total amount contributed is $58,800 + $29,400 = $88,200. The total amount earned in interest is $88,200 * 0.5% * 12 * 35 = $21,126. The total amount in the retirement account is $88,200 + $21,126 = $109,326.

Today Is January 1