Question

Lucas invests $2000 per year in his retirement account for 40 years in an investment with an average annual return of 10%. Approximately how much will he have after 40 years?
A.$88,000
B.$176,000
C.$312,000
D.$975,000

Answer 1

The amount Lucas would have in his account is $885,000.

The formula that would be used to determine the amount of money Lucas would be in 40 years is:

The formula for calculating future value = A x annuity factor  

Annuity factor = {[(1+r)^n] - 1} / r

Where:

• A = amount invested each year = $2000
• r = interest rate = 10%
• n = number of years = 40 years

$2000 x [(1.1^40 - 1) / 0.1] = $885,000

To learn more about future value, please check: https://brainly.com/question/14640433