Deposit each year to accumulate to the required amount

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Reference no: EM131853621

A wealthy art collector has decided to endow her favorite art museum by establishing funds for an endowment which would provide the museum with $1,000,000 per year for acquisitions into perpetuity. The art collector will give the endowment upon her 50th with the first payment on that birthday. She plans to accumulate the endowment by making annual equal deposits into an account from her 40th birthday until her 49th birthday. The rate of interest is expected to be 6 percent in all future periods. How much must the art collector deposit each year to accumulate to the required amount? $1,575,333 $ 736,000 $1,264,446 $ 943,396.

Reference no: EM131853621

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