Ursula Umfolozi has a high paying job. She decides to make equal monthly deposits into a bank account, starting today, so that when she retires in 30 years she will present the savings from this bank account to the Save the Wolf Foundation (STWF). The last deposit will be in exactly 30 years time. The money will then provide a perpetuity of annual payments to the Foundation with the first payment occurring in 31 years. Each payment will have the same purchase power as $3000 has today. The interest rate that she expects from the bank account is J4 = 4.147%, and the expected inflation rate is an effective 2% per year.

a. How much will Ursula need to have in her bank account in 30 years time to support the intended payments to STWF? [5]

b. How much must she deposit monthly to achieve her plan? [4]

c. What is the real rate of interest that she receives on her bank account? [3]