.) Determine the future value of education: Jenny Franklin estimates that as a result of completing her master’s degree, she will earn $7,000 a year more for the next 40 years.
A.) What would be the total amount of these additional earnings?

Question

.) Determine the future value of education: Jenny Franklin estimates that as a result of completing her master’s degree, she will earn $7,000 a year more for the next 40 years. 
A.) What would be the total amount of these additional earnings?

anonymous · Answer

I came out at $7,000 x 40 which is $280,000, but my instructor told me to revise this.

anonymous · Answer

its a problem that uses compounding. the idea is that the first year you would make x dollars, the second $7,000 more than x, the 3rd year you would make $14,000 more than x - so on and so forth..