If P50 was invested at 6% on January 1, year 1, what equal year-end withdrawals(P) could be madeeach year for ten years, leaving nothing in the fund after the tenth withdrawal? How much must be invested at the end of each month for 30yrs in a sinking fund that is to amountto P50000 at the end of 30yrs if interest is nominal 4% compounded annually?

Invested amount (PV) = P 50 Annual interest rate (R) = 6% Number of withdrawals (N) = 10 Annual…

Answered: If P50 was invested at 6% on January 1,…

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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If P50 was invested at 6% on January 1, year 1, what equal year-end withdrawals(P) could be made each year for ten years, leaving nothing in the fund after the tenth withdrawal?