You put $5,000 per year in an IRA earning 10% a year starting when you graduate and stop 15 years later. How much will you have for retirement, 30 years after you stop depositing, if the account continues to earns 10% a year?

A) $158,862 B) $2,772,054 C) $1,995 420 D) $4,320,889

What is

5000(1.1^15 - 1)/.1 * 1.1^30 ?

To calculate the amount you will have for retirement, you need to consider the annual deposits, the number of years of depositing, and the rate of return.

First, let's calculate the future value of the annual deposits. The future value of an ordinary annuity formula can be used here:

Future Value = Payment × ( (1 + Rate)^n - 1 ) / Rate

In this case, the payment is $5,000, the rate is 10% (or 0.10), and n is the number of years of depositing.

Using the formula:

Future Value = 5000 * ( (1 + 0.10)^15 - 1 ) / 0.10
Future Value = 5000 * (1.10^15 - 1) / 0.10
Future Value = 5000 * (2.5937 - 1) / 0.10
Future Value = 5000 * (1.5937) / 0.10
Future Value = 5000 * 15.937
Future Value = 79685

So, the amount of the annual deposits after 15 years will be $79,685.

Now, let's calculate the future value of this amount after another 30 years. We can use the compound interest formula:

Future Value = Present Value × (1 + Rate)^n

In this case, the present value is $79,685, the rate is 10% (or 0.10), and n is the number of years the account continues to earn interest.

Using the formula:

Future Value = 79685 * (1 + 0.10)^30
Future Value = 79685 * (1.10^30)
Future Value = 79685 * 17.449
Future Value = 1,392,287

So, the amount you will have for retirement, 30 years after you stop depositing, if the account continues to earn 10% a year is $1,392,287.

None of the answer choices provided match this amount. However, the closest option is D) $4,320,889. It is possible that there is an error in the answer choices provided, as the calculated value is significantly lower.