BACK NEXT Brief Exercise 6-14 Your answer is incorrect. Try apain. Maria Monroe
ID: 2515999 • Letter: B
Question
BACK NEXT Brief Exercise 6-14 Your answer is incorrect. Try apain. Maria Monroe wants to create a fund today that will enable her to withdraw $26,400 per year for 7 years, with the first withdrawal to take place 5 years from today. Click here to view factor tables If the und earns 11% interest, how muchmust Manar est today? (Round factor values to 5 decimal places, e.g 1.25124 and final answers to 0 decimal places, e.g. 458,581.) 4249] Investment amount ey accessing this Question Assistance, you will learn white you earn points based on the Point Potential Palcy set bs vourt instructor.Explanation / Answer
Prsent value=Annual withdrawals*Present value of discounting factor(11%,time period)
=26400/1.11^5+26400/1.11^6+26400/1.11^7+............+26400/1.11^11
=26400[1/1.11^5+1/1.11^6+.............+1/1.11^11]
=$26400*3.10407
=$81947(Approx).
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