Example: A person wants to withdraw $1000 every month, for 21 years, to supplement their pension check when they retire. a. How much money must be in an account that pays 7% interest compounded monthly, in order to meet their needs? b. How much money must be deposited into an account that pays 6.6% interest compounded monthly in order to achieve this amount? The monthly deposits will be made for 45 years How much money was actually deposited in to the account? How much money will actually be paid out from this account? 552 C. d. th247.08
Example: A person wants to withdraw $1000 every month, for 21 years, to supplement their pension check when they retire. a. How much money must be in an account that pays 7% interest compounded monthly, in order to meet their needs? b. How much money must be deposited into an account that pays 6.6% interest compounded monthly in order to achieve this amount? The monthly deposits will be made for 45 years How much money was actually deposited in to the account? How much money will actually be paid out from this account? 552 C. d. th247.08
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
Related questions
Question
A person wants to withdraw $1000 every month, for 21 years, to supplement their pension check when they retire.
a. How much money must be in an account that pays 7% interest compounded monthly, in order to meet their needs?
b. How much money must be deposited into an account that pays 6.6% interest compounded monthly in order to achieve this amount? The monthly deposits will be made for 45 years
C. How much money was actually deposited in to the account?
d. How much money will actually be paid out from this account?
Transcribed Image Text:Example:
A person wants to withdraw $1000 every month, for 21 years, to supplement their pension check when
they retire.
a. How much money must be in an account that pays 7% interest compounded monthly, in order
to meet their needs?
b.
How much money must be deposited into an account that pays 6.6% interest compounded
monthly in order to achieve this amount? The monthly deposits will be made for 45 years
C. How much money was actually deposited in to the account?
d. How much money will actually be paid out from this account?
52
OFE 7 8
-967.08
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