CompU has become a success over the past few years, and Bill and Melinda Jobs decide...

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CompU has become a success over the past few years, and Bill and Melinda Jobs decide...

CompU has become a success over the past few years, and Bill and Melinda Jobs decide it is time to meet with a financial planner to make certain his personal finances are in order. Bill has the following questions he needs help in answering regarding his current and future financial goals.

Bill’s mother passed away and left them $32,976. They plan to put the entire amount into an account earning 8% compounded annually and to withdraw an equal amount at the end of each year for 14 years. How much will they be able to withdraw each year?

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Answer 1

Answer #1

Present value of annuity=Annuity[1-(1+interest rate)^-time period]/rate

32976=Annuity[1-(1.08)^-14]/0.08

32976=Annuity*8.244236983

Annuity=32976/8.244236983

which is equal to

=$3999.89(Approx).

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Answer 2

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