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Your answer is incorrect. Try again. Robert Hitchcock is 40 years old today and he wishes to accumulate $500,000 by his 65th birthday so he can retire to his summer place on Lake Hopatcong. He wishes to accumulate this amount by making equal deposits on his 40th through his 64th birthdays, what annual deposit must Robert make if the fund will earn 8% interest compounded annually? (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places, e.g. 458,581.) Annual deposit

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Answer #1

A = P[(1+i)^n -1][1+i] / i

i = interest rate = 0.08

n = period = 25

500,000 = P*(1.0.8^25 - 1)*(1.08 / 0.08)

P = $6,333

Annual deposit = $6,333

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