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A new graduate wants to deposit an annual saving amount for 25 years in order to withdraw $25,000 per year during retirement. The withdrawal will
A new graduate wants to deposit an annual saving amount for 25 years in order to withdraw $25,000 per year during retirement. The withdrawal will start one year after the last deposit and the withdrawals should last for 30 years. The graduate uses 8% per year interest rate.
a) Draw the cash flow diagram
b) How much does the graduate need to deposit each year for the first 25 years?
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