A

PARTIAL CREDIT$--$ You must use Excel equations and functions $(30$ pts$)$

Michael is planning his retirement $30$ years from now.

Michael plans to withdraw $$15,000$ per month from his retirement account for $15$ years and then $$7,500$ a month for the following $10$ years. He will withdraw from this account for a total of $25$ years. He plans to have $$500,000$ for his heirs at the end of the retirement period. Michael will earn $4$ percent compounded monthly during the retirement phase of his life.

He plans to save $$500$ each month for the next $30$ years $($ordinary annuity$).$ What APR must Michael earn during his savings period assuming monthly compounding?

What APR must Michael earn during his savings period assuming monthly compounding?

Saving Period

Initial Balance

Total Length

Savings amount

Rate during Savings $($APR$)$

Retirement Period

Withdrawal Period I

Withdrawal amount in period I

Withdrawal Period $2$

Withdrawal amount in period $2$

Inheritance

Rate during Retirement

$$0$

$30$ years

$$500$ per month

$?$ APR

$15$ years

$$15,000$ per month

$10$ years

$$5,000$ per month

$$500,000$

$4\mathrm{.}00\%$ APR