Question 4. 20 marks

In order to take a trip to Scotland; you will need R 200 000 per year for the next four years. You have already saved R40 000, and you have placed the money in an account that you expect will yield a monthly compounded interest rate of 0.75%. Money for the first of the four payments will be removed from the account exactly 15 years from now, and the last withdrawal will be made 18 years from now. You have decided to save more by making monthly payments into the same account, yielding 0.75% interest per month over the next 14 years beginning next month. You will take the money out of the 0.75% per month account and place it in a 6% per annum account in 14 years and take the cash out as needed.

Required: How much money should you set aside each month to work toward this objective? Please give thorough justifications for your assumptions and actions, along with working examples and commentary. Show all works clearly step by step