Question

Determine the amount needed such that when it comes time for retirement, an individual can make semiannual withdrawals in the amount of $15,265 for 35 years from an account paying 4.5% compounded semiannually. round your answer to the nearest cent. a. $938,272.00 b. $941,790.00 c. $535,528.03 d. $547,577.41

Answer 1

Answer:

225093.358

Step-by-step explanation:

Answer 2

The amount needed such that when it comes time for retirement, an individual can make semiannual withdrawals in the amount of $15,265 for 35 years is $225093.358.

The total amount to be withdrawn in a year = 15265*2 = $30530

The total amount to be withdrawn in 35 years =$1068550

What is the compound interest?

Compound interest is interest on interest along with interest on the principle.

Annual Rate of interest = 4.5%

Semi-annual rate of interest r=2.25%

Amount A= $1068550

$1068550 =P(1+\frac{2.25}{100})^70$

$P = 225093.358$

Therefore, the amount needed such that when it comes time for retirement, an individual can make semiannual withdrawals in the amount of $15,265 for 35 years is $225093.358.

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