Question: You begin working a full-time job after graduation. You work for 40 years. Every month, you contribute $500 to a traditional individual retirement account (IRA).

You begin working a full-time job after graduation. You work for 40 years. Every month, you contribute $500 to a traditional individual retirement account (IRA). Assume that you earn 0.80 percent interest per month. Please show all of your work.

1.) How much money is in your IRA when you retire? Assume that you make a total of 40 x 12 = 480 contributions.

2.) You plan to use your IRA to fund your retirement. Taking the balance calculated in question 1 for a total of 25 years, how much can you withdraw each month? Assume you earn an interest rate of 0.50 percent per month on your retirement savings.

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