Starla has decided to retire in 12 years. She has 44,400 available today and wants to invest the money to supplemement her pension plan.
a. Assume Starla wants to accumulate 100,000 by her retirement date. Will she achieve her goal if she invests 44,400 today and earns 7%?
b. If Starla invests a total of 44,400 through a series of 12 equal annual installments instead of a single amount, would Starla accumulate the desired 100,000? The first investment would be made one year from today. Show calculations and explain what you find.
c. If the amount accumulated in part A does not equal 100,000, approximately how many years would be required, assuming the same interest rate and equal annual deposits as above.