How much money should be deposited annually in a bank account for five years if you wish to withdraw $4,000 each year for three years, beginning five years after the last deposit? The interest rate is 5% per year. The annual deposit amount should equal _____
How much money should be deposited annually in a bank account for five years if you wish to withdraw $4,000 each year for three years, beginning five years after the last deposit? The interest rate is 5% per year. The annual deposit amount should equal _____
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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How much money should be deposited annually in a bank account for five years if you wish to withdraw $4,000 each year for three years, beginning five years after the last deposit? The interest rate is 5% per year. The annual deposit amount should equal _____
Transcribed Image Text:Compound
Amount
Factor
To Find F
To Find P
Given P
Given F
Given A
Single Payment
Discrete Compounding; /-5%
Present
Worth Factor
Compound
Amount
Factor
To Find F
Uniform Series
Sinking
Present
Worth Factor
Fund
Factor
To Find A
Capital
Recovery
Factor
To Find A
Given P
To Find P
Given A
Given F
N
F/P
P/F
F/A
P/A
A/F
A/P
1
1.0500
0.9524
1.0000
0.9524
1.0000
1.0500
2
1.1025
0.9070
2.0500
1.8594
0.4878
0.5378
3
1.1576
0.8638
3.1525
2.7232
0.3172
0.3672
4
1.2155
0.8227
4.3101
3.5460
0.2320
0.2820
5
1.2763
0.7835
5.5256
4.3295
0.1810
0.2310
6
1.3401
0.7462
6.8019
5.0757
0.1470
0.1970
7
1.4071
0.7107
8.1420
5.7864
0.1228
0.1728
8
1.4775
0.6768
9.5491
6.4632
0.1047
0.1547
9
1.5513
0.6446
11.0266
7.1078
0.0907
0.1407
10
1.6289
0.6139
12.5779
7.7217
0.0795
0.1295
11
1.7103
0.5847
14.2068
8.3064
0.0704
0.1204
12
1.7959
0.5568
15.9171
8.8633
0.0628
0.1128
13
1.8856
0.5303
17.7130
9.3936
0.0565
0.1065
14
1.9799
0.5051
19.5986
9.8986
0.0510
0.1010
15
2.0789
0.4810
21.5786
10.3797
0.0463
0.0963
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