Answer the following two questions below. For each answer give a short explanation of your solution, i.e. what formula was used and what values were substituted for the variables. I can give you partial credit for explaining your work even if your answer is incorrect. Mary wants to receive a payout of $1500 per month for 20 years.

1) How much money must be in the deposit if the money earns 4.2% compounded monthly?

2) How large monthly payment would Mary have made if she saves for her payout annuity with an ordinary annuity, 30 years before she needed it? Assume that two annuities have the same interest rate 4.2%.

Answer rating: 100% (QA)

Solution Answer 1 How much money must be in the deposit ... View the full answer