Cheryl Wilcox is planning for her retirement, so she is setting up a payout annuity with her bank. She wishes to receive a payout of$1,500per month for twenty years.

How much money must she deposit if her money earns 8% interest compounded monthly? (Round your answer to the nearest cent.)

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Find the total amount that Cheryl will receive from her payout annuity.

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Question 2: Dean Gooch is planning for his retirement, so he is setting up a payout annuity with his bank. He wishes to receive a payout of$1,300per month for twenty-five years.

How much money must he deposit if his money earns 7.3% interest compounded monthly? (Round your answer to the nearest cent.)

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Find the total amount that Dean will receive from his payout annuity.

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Question 3: Cheryl Wilcox is planning for her retirement, so she is setting up a payout annuity with her bank. She wishes to receive a payout of$1,100per month for twenty years. (Round your answers to the nearest cent.)

How large a monthly payment must Cheryl Wilcox make if she saves for her payout annuity with an ordinary annuity, which she sets up thirty years before her retirement? (The two annuities pay the same interest rate of 8% compounded monthly.)

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Find the total amount that Cheryl will pay into her ordinary annuity.

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Question 4: Dean Gooch is planning for his retirement, so he is setting up a payout annuity with his bank. He wishes to receive a payout of$1,500per month for twenty five years. His money earns 7.3% interest compounded monthly. (Round your answers to the nearest cent.)

How large a monthly payment must Dean Gooch make if he saves for his payout annuity with an ordinary annuity, which he sets up thirty years before his retirement? (The two annuities pay the same interest rate.)

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How large a monthly payment must he make if he set the ordinary annuity up twenty years before his retirement?

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Question 5: Wally Brown is planning for his retirement, so he is setting up a payout annuity with his bank. For twenty-five years, he wishes to receive annual payouts that start at$14,000and then receive an annual COLA of 3.5%. (Round your answers to the nearest cent.)

How much must he deposit if his money earns 8.3% interest per year?

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How large will Wally's first annual payout be?

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How large will Wally's second annual payout be?

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How large will Wally's last annual payout be?

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Question 6: Shelly Franks is planning for her retirement, so she is setting up a payout annuity with her bank. She is now 35 years old, and she will retire when she is 65. She wants to receive annual payouts for twenty years, and she wants those payouts to receive an annual COLA of 4%.

She wants her first payout to have the same purchasing power as does$15,000today. How big should that payout be if she assumes inflation of 4% per year?

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How much money must she deposit when she is 65 if her money earns 8.3% interest per year?

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How large a monthly payment must she make if she saves for her payout annuity with an ordinary annuity? (The two annuities pay the same interest rate.)

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How large a monthly payment would she make if she waits until she is 40 before starting her ordinary annuity?

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Question 7: John-Paul Ramin won$2.4million in a state lottery. He was surprised to learn that he will not receive a check for$2.4million. Rather, for twenty years, he will receive an annual check from the state for1/20 of his winnings. The state finances this series of checks by buying John-Paul a payout annuity. Find what the state pays for John-Paul's payout annuity if the interest rate is 7.2%. (Round your answer to the nearest cent.)

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Answer rating: 100% (QA)

To calculate the amount Cheryl and Dean must deposit for their payout annuities as well as the total amount they will receive we use the following formula for present value of an ordinary annuity PV P... View the full answer