In June
2004
, Susan set up a TDA to save for retirement. She agreed to have
$
200
deducted from each of her monthly paychecks. The annuity’s interest rate was allowed to change once each year.
a. In
2004
, the interest rate was
1
%
. Find the account balance in June
2005
.
b. In
2005
, the interest rate was
2.25
%
. Find the account balance in June
2006
. To do this, think of the June
2005
account balance as a lump sum that earns compound interest.
c. In
2006
, the interest rate was
4.5
%
. Find the account balance in June
2007
.