Answer:
Additional money, the firm have 4 years from now if it can earn 5 percent rather than 4 percent on its savings will be $3,423.
Explanation:
Principal Amount = P = $75,000
Number of year = n = 4 years
If rate of return is 4%
A = P ( 1 + r )^n
A = $75,000 ( 1 + 0.04 )^4
A = $75,000 x 1.16986
A = $87,740
If rate of return is 5%
A = P ( 1 + r )^n
A = $75,000 ( 1 + 0.05 )^4
A = $75,000 x 1.21551
A = $91,163
Additional Amount Earned = $91,163 - $87,740 = $3,423
