The question is as follows:
$30,000 is invested at the start of each year for the next 20 years. The money invested earns interest at an annual effective rate of 4%. The interest earns interest at an effective rate of 2% a year. If all interest payments are made at the end of the year, find the value of the investment at the end of 20 years.
I'm confused as to how to account for the interest earned each year earning new interest at a different rate (2%) than the account (4%).
I've done problems involving removing & reinvesting interest earned on an account, where you treat the interest earned yearly as a separate account, but I don't see how that can be applied here.