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Ella Funt would like to set up her retirement account that will begin in 30 years....

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Finance

Ella Funt would like to set up her retirement account that willbegin in 30 years. To play it safe, she wants to assume that shewill live forever and she will withdraw $160,000 annually. Assumingher account will earn 10% interest during the next 30 years and 5%interest afterwards forever, how much will Ella need to saveannually over the next 30 years to fund her retirement account?

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3.9 Ratings (556 Votes)
Answer During retirement period Rate of interest 5 Annual withdrawal forever 160000 Retirement corpus required 160000 5 3200000 As the question does not say whether    See Answer
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Transcribed Image Text

Ella Funt would like to set up her retirement account that willbegin in 30 years. To play it safe, she wants to assume that shewill live forever and she will withdraw $160,000 annually. Assumingher account will earn 10% interest during the next 30 years and 5%interest afterwards forever, how much will Ella need to saveannually over the next 30 years to fund her retirement account?

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