Anita opens a savings account. At the start of cach month she deposits SX into the savings account. At the end of each month, after interest is added into the savings account, the bank withdraws $2500 from the savings account as a loan repayment. Let M be the amount in the savings account after the n withdrawal. The savings account pays interest of 4.2% per annum compounded monthly. Show that after the second withdrawal the amount in the savings account is given by (i) M = X(1.0035+ 1.0035)-2500(1.0035 + %3D (ii) Find the value of X so that the amount in the savings account is $80 000 after the last withdrawal of the fourth year.

Anita opens a savings account. At the start of cach month she deposits SX into the savings account. At the end of each month, after interest is added into the savings account, the bank withdraws $2500 from the savings account as a loan repayment. Let M be the amount in the savings account after the n withdrawal. The savings account pays interest of 4.2% per annum compounded monthly. Show that after the second withdrawal the amount in the savings account is given by (i) M = X(1.0035+ 1.0035)-2500(1.0035 + %3D (ii) Find the value of X so that the amount in the savings account is $80 000 after the last withdrawal of the fourth year.

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

Problem 1PS

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Derek currently has $12,990.00 in an account that pays 5.00%. He will withdraw $5,849.00 every other year beginning next year until he has taken 7.00 withdrawals. He will deposit $12990.0 every other year beginning two years from today until he has made 7.0 deposits. How much will be in the account 30.00 years from today? Submit Answer format: Currency: Round to: 2 decimal places,

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