Question

CSePub Home Book Store Instructors Independent Authors About Aweathy pantstryngtotns atrunthndfor his oldestson The parent has set aside S435700 00 kday n an outthat pays 7.00% anud iteed Ha oldet son wil begn receiving the brust in 14,00 years, and the tust is set up to pay 17.00 identical annual payments.What will be the yearly wthdrawal for the son thom the tust? Answer Format: Currency: Round to: 2 decimal places Enter Answer Here 5 0

Answer 1

Amount set aside = $435,700.00
Annual interest rate = 7.00%
Number of payments = 17
First payment is received after 14 years

Let annual payment be $x

$435,700 = $x/1.07^14 + $x/1.07^15 + .... + $x/1.07^30
$435,700 = $x * (1/1.07)^13 * (1 - (1/1.07)^17) / 0.07
$435,700 = $x * 4.051390
$x = $107,543.34

So, the yearly withdrawal will be $107,543.34