# Starting next year, you will need $5,000 annually for 4 years to complete your education. (One year from today you will withdraw the first $5,000.) Your uncle deposits an amount today in a bank paying 6% annual interest, which will

Starting next year, you will need $5,000 annually for 4 years to complete your education. (One year from today you will withdraw the first $5,000.) Your uncle deposits an amount today in a bank paying 6% annual interest, which will provide the needed $5,000 payments.

a. How large must the deposit be?

b. How much will be in the account immediately after you make the first withdrawal?

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**Related Book For**

## Fundamentals of Financial Management

**ISBN:** 978-1305635937

Concise 9th Edition

**Authors:** Eugene F. Brigham

**Question Details**

Chapter #

**5**Section: Exercise Questions

Problem: 26

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