Question
On Dr. Browns 35th birthday, she begins making equal-sized monthly deposits into an account that earns 6.24% annual interest compounded monthly such that after 25
On Dr. Browns 35th birthday, she begins making equal-sized monthly deposits into an account that earns 6.24% annual interest compounded monthly such that after 25 years (300 deposits), when Dr. Brown is 60 years old her account balance is $500,000.
a) What size deposits does Dr. Brown make?
b) When Dr. Brown is 60 years old and her account balance finally reaches $500,000, she stops making deposits and starts making equal-sized repeated withdrawals at the end of each month for the next 20 years (240 withdrawals total). What size withdrawal can she plan to make each month so that her account balance is zero after her final withdrawal, when she is 80 years old?
c) What is the total amount of interest that Dr. Brown earns by keeping her money in this account for 45 years as described?
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