What is maximum amount alicia will be able to withdrawal

Assignment Help Financial Management

Reference no: EM131921867

Alicia has a job with a DC regulator that offers a terrific benefit package. The agency contributes an annuity of $545 into a bank account in her name at the end of each month, beginning one month from today. Alicia estimates that she will work for the next 37 years (for 444 months), when at that point she'll retire. At the time of her retirement, Alicia plans to spend this bank account by drawing a monthly annuity until her projected mortality, Specifically, she will withdrawal her first monthly amount immediately at retirement, and then monthly for 25 consecutive years in retirement. Assuming an interest rate of 4% annually, what is the maximum amount Alicia will be able to withdrawal, per month, during her retirement years?

Reference no: EM131921867

Questions Cloud

Assignment-steps to hypotheses testing : For this Assignment, review this week's Learning Resources, including the 5 step approach to hypothesis testing document. Read the research scenario

Evaluating and understanding business markets : Explain how SIC codes might be helpful in evaluating and understanding business markets. Give an example. Considering the nature of retail buying.

What type of communication tool would use to present idea : You have an idea to improve patient care that you would like upper management. What type of communication tool would you use to present your idea and why?

How much could the firm save annually in carrying costs : How much could the firm save annually in ordering and carrying costs by usuing the EOQ?

What is maximum amount alicia will be able to withdrawal : what is the maximum amount Alicia will be able to withdrawal, per month, during her retirement years?

Determine the equivalent present value of the policy : Determine the equivalent present value of the policy to Hector if the interest rate is 5.05%.

What are the characteristics of a performance-driven team : What differentiates someone that is intrinsically motivated from someone that is extrinsically motivated? What are characteristics of a performance-driven team?

Find the number of machines we need to manufacture : Assuming factory operates 300 days/ year; a daily shift of 8 hours. Find the number of machines we need to manufacture 50,000 units per year.

Optimal cash return point : HotFoot Shoes would like to maintain its cash account at a minimum level of $43,000, What will be its optimal cash return point?

User Account

All Pages