Suppose you contribute $2500 to an RRSP at the beginning of every six months for 25 years, and then use the accumulated funds to purchase an annuity paying $2500 at the beginning of each month How long after the start of the annuity will the last payment be made Assume that the RRSP earns 8 compoun...

At a focal date at 25 years from now FV of the RRSP contributions PV of th ...

Suppose you contribute $2500 to an RRSP at the beginning of every six months for 25 years,

Question:

Suppose you contribute $2500 to an RRSP at the beginning of every six months for 25 years, and then use the accumulated funds to purchase an paying $2500 at the beginning of each month. How long after the start of the will the last payment be made? Assume that the RRSP earns 8% compounded semiannually and the funds invested in the earn 5.1% compounded monthly.
Annuity
An annuity is a series of equal payment made at equal intervals during a period of time. In other words annuity is a contract between insurer and insurance company in which insurer make a lump-sum payment or a series of payment and, in return,...