a) Your favorite aunt opens a savings account on your name and deposits $10,000 at the...

a) Your favorite aunt opens a savings account on your name and deposits $10,000 at the end of each year for 10 years. The account earns an interest rate of 2.2%. After the final deposit, you move the accumulated savings to your brokerage account and invest in the stock market, where they earn an average return of 5.8% for the following 23 years. How much will you have in your account at the end? Round to the nearest cent.

b) You have $112,000 in an account earning 1.2% per year. You plan to make 17 annual withdrawals out of this account starting 4 years from today. What are the equal annual withdrawals you can make that will deplete the account at the end?

c) You'd like to buy a 40-foot used catamaran in 19 years for $500,000. You already have $22,000 saved in an account earning a monthly interest rate of 0.42%. Your plan is to make monthly deposits into this account in order to save enough to buy the catamaran. How much would you need to save monthly?

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jeff jeffy answered 1 year ago

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