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You deposit $4,500 per year at the end of each of the next 25 years into an account that pays 10% compounded annually. How much could you withdraw at the end of each of the 20 years following your last deposit if all withdrawals are the same dollar amount? (The twenty-fifth and last deposit is made at the beginning of the 20-year period. The first withdrawal is made at the end of the first year in the 20-year period.)
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Solution Summary
The solution describes the steps for calculating equal annual withdrawal amount from the earlier accumulations.
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Solution:
Annual Deposits=R=$4500
Number of periods=n=25
Interest rate=i=10%
Future Value of this ordinary ...
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- BEng (Hons) , Birla Institute of Technology and Science, India
- MSc (Hons) , Birla Institute of Technology and Science, India
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