You have deposited $8,800 in a special account that has a guaranteed interest rate of 20% per year. If you are willing to completely exhaust the account, what is the maximum amount that you could withdraw at the end of each of the next 7 yn exceliea

Maximum amount = $10,108.43

Explanation:

The maximum amount that can be withdrawn from the account would be the future value of the lump sum of $8,800 invested at 20% p. a.

The future value under compound interest is computed as follows:

FV = P * (1 + r) ^ (n)

FV - future value P - principal deposit, rate per period, n - number of period

The future value

PV - 8,800, r - 20%, n - number of years

= 8,800 * (1+0.2) ^ (7) = $10,108.43

Future value = $10,108.43