Please help me study for a test by helping me with this problem. Thanks!
Sue and Neal are friends. Sue invests $5,000/yr. at 7 percent when she is 25 years old. She makes annual investments for 10 years. Neal spends and parties for 10 years, saving nothing. When he “grows up” at age 35, he begins to invest7 $5,000/yr. at 7 percent. Neal makes annual investments until he retires. Both investments compound interest annually. Both Sue and Neal retire at age 60. Which one of the following statements is correct assuming that neither Sue nor Neal has withdrawn any money from their accounts?
Question 5 options:
a) Neal will earn more interest on interest than Sue.
b) Neal will earn more compound interest than Sue.
c) Sue will have less money when she retires than Neal.
d) If both Sue and Neal wait to age 70 to retire, then they will have equal amounts of savings.
e) Sue will have more money than Neal at retirement.