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An employee has decided to make annual contributions over a 15-year period into a retirement fund. She wants to make the first contribution of $10,000 one year from now (t=1). She then plans to increase her annual contribution by $1,000 each year for the remaining years. The fund is expected to earn 10% per year compounded annually. If she decides to retire in 15 years (from now), what equal annual amount can she withdraw annually for a period of 10 years starting one year after retirement? Assume that the fund will be depleted when the last withdrawal is made.

4) (24 points) An employee has decided to make annual contributions over a 15-year period into a retirement fund. She wants t
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Answer #1

Annual withdrawal = (10000*(F/A,10%,15) + 1000*(F/G,10%,15))*(A/P,10%,10)

= (10000*31.772482 + 1000*167.724817)*0.162745

= 79004.50

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