Scenario #2: Pamela Pamela is also a saver. She sets aside $100 per month during her 40 year career. She invests in the US stock market
through an index fund that averages a 7% return over this 40 year period.
5.
What is the total balance in
the account after 40 years?
6. How much of the total did
Pamela contribute herself?
7. How much money did Pamela
make through compounded
returns in this investment
account?
8. Why is Pamela's total balance so much greater than Raul's even though she contributed the same amount as
he did?