2nd pic is the hint (example)

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A wealthy parent is trying to fund a trust fund for his oldest son. The parent has set aside $274,000.00 today in an account that pays 6.00% annual interest. His oldest son will begin receiving the trust in 17.00 years, and the trust is set up to pay 19.00 identical annual payments. What will be the yearly withdrawal for the son from the trust? Submit Answer format: Currency: Round to: 2 decimal places. Show Hint A wealthy parent is trying to fund a trust fund for his oldest son. The parent has set aside $500,000.00 today in an account that pays 8.00% annual interest. His oldest son will begin receiving the trust in 10.00 years, and the trust is set up to pay 20.00 identical annual payments. What will be the yearly withdrawal for the son from the trust? SOLUTION: With the deferred annuity, we must recognize that our traditional annuity formula gives us a value where the annuity begins, not necessarily time 0. Our first step here is to find the value of the trust in 10 years using the FV formula. This now becomes the PV of our withdrawals. USING FINANCIAL CALCULATOR: N 10 1/Y PV 8 -$500,000 N 20 FVN = PVx(1 + r)N FV10 $500,000x(1.08)10 = $1,079,462.50 T*(1-(7)*)*(1 + r) $1,079,462.50= *(1-(2))x(1.08) PMT 0.08 PMT 0 PMT 1,079,462.50 7 PV = PMT Enter numbers and then CPT FV. FV-$1,079,462.50 Then, SET CALCULATOR TO BEGIN 1/Y PV 8 FV 7 FV 0 PMT $101,801.52 CPT PMT $101,801.52 USING EXCEL: -FV (8%,10,0,-500000,0)-$ 1,079,462.50 -PMT( 8 %,20, 1079462.50,0,1)-$101,801.52