How much money should be deposited annually in a bank account for five years if you wish to withdraw $5 comma 500 each year for

Question

2 years ago

10

three years, beginning five years after the last deposit? The interest rate is 4% per year.

1 answer:

Zarrin [17] · Answer 1 · 2022-08-20T08:49:32+03:00

Answer:

The initial deposit should be $ 25.46

Explanation:

The Annuity formula is

P=R [1−(1+i)^-n/i]⋅(1+i)

Where

P= Initial deposit

R=Regular Withdraw amount

i=Interest rate

n=Number of years/periods

After entering corresponding values in the formula we get $25.46

so P (which is our initial deposit)=25.46

How much money should be deposited annually in a bank account for five years if you wish to withdraw ​$5 comma 500 each year for