Answer:
The applicable options are:
$7,997.75 $5,842.50 $6,955.93 $8,799.06
The first one ,$ 7,997.75 is correct answer
Explanation:
The amount of monthly withdrawal can be computed using the pmt formula in excel
=pmt(rate,nper,-pv,fv)
rate is the monthly rate of return which is 6%/12=0.5%
nper is the thirty years multiplied by 12 which is 360 months
pv is the current amount in her retirement savings which is $1.5 m
fv is the amount expected to be left in the account for children and grandchildren which is $1 m
=pmt(0.5%,360,-1500000,1000000)=$ 7,997.75
The amount of monthly withdrawal is 7,997.75
