She will receive from her payout annuity

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Cheryl Wilcox is planning for her retirement, so she is setting up a payout annuity with her bank. She wishes to receive a payout of $1,900 per month for twenty years. (Round your answers to the nearest cent.)

(a) How large a monthly payment must Cheryl Wilcox make if she saves for her payout annuity with an ordinary annuity, which she sets up thirty years before her retirement? (The two annuities pay the same interest rate of 8% compounded monthly.) $

(b) Find the total amount that Cheryl will pay into her ordinary annuity. $

Compare it with the total amount that she will receive from her payout annuity.

Reference no: EM132036936

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