Question: Please write out your steps and financial calculator function keys
Your paycheck today is $80,000 (on your 30th birthday) and you expect your paycheck to increase by 10% each year, starting your 31st birthday all the way to your 60th birthday, when you plan to retire (you will receive your last paycheck on your 60th birthday). Starting today you will set aside 5% of your annual paycheck into a special saving account which pays 14% interest compounded annually. Remember you first deposit into the special account begins today and the last deposit is in your 60th birthday.
a. What is the present value of these deposits into the savings account.
b. Also, what is the future value of these deposits on your 60th birthday?