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Problem 7-21

Auntie Kitty sells her home for $150,000, which is then invested to earn 4 percent annually. If her life expectancy is fifteen years, what is the maximum amount she can annually spend on a nursing home, doctors, and taxes? Use Appendix D to answer the question. Round your answer to the nearest dollar. The maximum amount that can be annually spend is $ .

If the return were to double to 8 percent, will the amount she may spend each year more than double? Use Appendix D to answer the question. Round your answer to the nearest dollar. If the return were to double, the amount that can be annually spend will -Select-more than doubleless than doubledoubleItem 2 and will be equal to $ .