A retirement account has $320,000.00 that will be used to start an annuity that earns...
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A retirement account has $320,000.00 that will be used to start an annuity that earns 6.8%, compounded monthly. The annuity will make payments at the end of every month in the amount of $2,300.00. How long will this annuity last? a. A business sets up a sinking fund so they will have a $54,000.00 to pay for a replacement piece of equipment in 12 years when the current equipment will be sold for scrap. If they make deposits at the end of each month for 12 years in the investment that pays 5.3% compounded monthly, what size should each payment be? b. A man wants to set up a 529 college savings account for his granddaughter. How much would he need to deposit each year into the account in order to have $50,000 saved up for when she goes to college in 15 years, assuming the account earns a 8% return.
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