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Cindy Alvarez is investing $370,400 in a fund that earns 8% interest compounded annually. Click here...

Cindy Alvarez is investing $370,400 in a fund that earns 8% interest compounded annually.

Click here to view factor tables

What equal amounts can Cindy withdraw at the end of each of the next 20 years? (Round factor values to 5 decimal places, e.g. 1.25124 and final answers to 0 decimal places, e.g. 458,581.)

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Answer #1

The present value of annual withdrawals = Investment

370,400 = Annual withdrawal*Present value annuity factor(8%, 20 years)

370,400 = Annual amount*9.8181

Hence, annual amount = $37,726.24

Hence, amount to be withdrawn at the end of each year = $37,726.24

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