john would like to buy an rv to fulfill his dream of travelling across the country and camping at every national park.
a. he knows that the rv will cost him $140,000. how many years will it take him to save the money if he saves $3,000 per year with an interest rate of 6% compounded annually? assume he puts the first $3,000 in the bank at the end of the first year.
b. let’s look deeper at the answer of 22.911 years provided in part a. how much will john have in the bank immediately after making his deposit at the end of year 22?
c. if he does not make another deposit in the savings account, how much will he have at the end of year 23? assume annual compounding as before.
d. given the scenario and answer to part c, will he have enough money to purchase the rv after year 23? explain why or why not.