5-HB. (Comprehensive present value) You are trying to plan for retirement in 10 years and currently you have $150,000 in a savings account and $250,000 in stocks. In addition, you plan to add to your savings by depositing $8,000 per year in your savings account at the end ofeach of the next five years and then ~1 0,000 per year at the end of each year for the final five years until retirement.

a. Assuming your savings account reUlrns 8 percent compounded annually and your investment in stocks will reUlrn 12 percent compounded annually, how much will you have at the end of 10 years? (Ignore taxes.)

b. If you expect to live 20 years after you retire, and at retirement you deposit all of your savings in a bank account paying 11 percent, how much can you withdraw each year after retirement (20 equal withdrawals beginning one year after you retire) to end up with a zero-balance at death?