You Just Graduated and You Expect to Work for Ten

Multiple Choice

You just graduated and you expect to work for ten years and then to leave for the Australian "Outback" bush country.You figure you can save $1,000 a year for the first five years and $2,000 a year for the next five years.These savings cash flows will start one year from now.In addition,your family has just given you a $5,000 graduation gift.If you put the gift now and your future savings when they start,into an account that pays 8% compounded annually,what will your financial "stake" be when you leave for Australia 10 years from now.(Round to the nearest whole dollar)

A) $21,432
B) $28,393
C) $16,651
D) $31,148
E) $20,000