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1b. Originally, the depositor intended to withdraw $100 at the end of 2023, emptying an account that earns 5% interest, compounded annually. Now, suppose the depositor changes their mind (i.e., does not empty the account in 2023) and instead delays withdrawing their money until 2025. What withdrawal amount would empty the account?

1b. Originally, the depositor intended to withdraw $100 at the end of 2023, emptying an account that earns 5% interest, compounded annually. Now, suppose the depositor changes their mind (i.e., does not empty the account in 2023) and instead delays withdrawing their money until 2025. What withdrawal amount would empty the account?

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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1b. Originally, the depositor intended to withdraw $100 at the end of 2023, emptying an account that earns 5% interest, compounded annually. Now, suppose the depositor changes their mind (i.e., does not empty the account in 2023) and instead delays withdrawing their money until 2025. What withdrawal amount would empty the account?
Transcribed Image Text:1b. Originally, the depositor intended to withdraw $100 at the end of 2023, emptying an account that earns 5% interest, compounded annually. Now, suppose the depositor changes their mind (i.e., does not empty the account in 2023) and instead delays withdrawing their money until 2025. What withdrawal amount would empty the account?
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