Mr Lewis Nixon is 22 years old and has just made his first contribution of $3,000 into his

BankEast Retirement Savings Account which pays interest of 12% p.a. compounded quarterly.

He plans to make a $3,000 deposit every year until he retires at age 67 (inclusive).

1. How much money will Mr Nixon have accumulated in his retirement account by the time

he makes his last deposit at age 67?

a) $4,862,900.50

b) $4,074,690.10

c) $5,477,790.75

d) $4,324,584.82

e) $4,566,652.91

2. If Mr Nixon expects to live off his retirement savings for 30 years how much can he afford

to withdraw from his BankEast Retirement Savings Account at the end of each year after

he retires?

a) $707,905.27

b) $526,288.17

c) $558,838.91

d) $590,119.89

e) $628,402.10