2. Determine theamount of money that needs to be deposited 5 years fro

QUESTION

2. Determine theamount of money that needs to be deposited 5 years from now towithdraw $6,000 per year for 7 years beginning 10 years from now ifthe interest rate is 8% per year.
Annual Withdrawl amount $6,000.00 Number of years to withdraw the amount 7 years Interest rate 8% per year Calculating Present ValueAnnuity of withdrawls: (Using Excel “PV” Function) Interest rate (Rate) 8% Number of years (Nper) 7 years Withdraw Amount per year (PMT) -$6,000 Present Value of Annuity (PV) $31,238.22 Calculating Present

lue of Deposit Amount: (Using Excel “PV” Function) Interest rate (Rate) 8% Number of years (Nper) 5 years Future Value of Deposit Amount (FV) -$31,238.22 Present Value of Deposit Amount (PV) $21,260.20 Deposit Amount $21,260.20

ANSWER:

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