Reference no: EM132555248

Amelia deposits $X into her bank account today. The money is sufficient to support 20 quarterly withdrawals of $500 starting in 3 months. The interest rate is 2% p.a. compounded quarterly for the first year and 3% p.a. compounded quarterly thereafter. Which of the following equations can be used to find $X (Only one correct answer)?

X=500/0.02*(1-1.02^-4)+500/0.03*(1-1.03^-16)*(1.02)^-4

X=500/0.005*(1-1.005^-4)+500/0.0075*(1-1.0075^-16)*(1.005)^-4

X=500/0.02*(1-1.02^-4)+500/0.03*(1-1.03^-16)

X=500/0.005*(1-1.005^-4)+500/0.0075*(1-1.0075^-16)

None of the options gives the correct X.

Calculate X and input your answer below. (Round your answer to 2 decimal places. Do not put unit. Do not use comma separators. E.g. 1234.56)