Today, you wish to deposit exactly enough (no more nor less than required) to allow you to
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Question:
Today, you wish to deposit exactly enough (no more nor less than required) to allow you to make fifteen annual end-of-year withdrawals, starting six years from today as shown below:
YEAR END-OF-YEAR WITHDRAWAL
6 $1,000 (1.05)1
7 $1,000 (1.05)2
.
.
.
20 $1,000 (1.05)15 + $6,000
What must the amount of this deposit be, if the account into which the deposit is made offers 10 percent compounded annually during years 1 through 5 and switches to 12.35 percent compounded annually there after?
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date: