45. Retirement options. This exercise illustrates just how fast exponential functions grow in the long term. Suppose you start work for a company
at age 25. You are offered two rather unlikely retirement options:
Retirement option 1: When you retire, you will receive $20,000 for
each year of service.
Retirement option 2: When you start work, the company deposits
$2500 into a savings account that pays a monthly rate of 1.5%.
When you retire, the account will be closed and the balance given to
you.
How much will you have under the second plan at age 55? At age 65?
Which retirement option is better if you plan to retire at age 55? Which
if you plan to retire at age 65?