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What is the maximum amount alex can withdraw

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Question - Alex have discovered a magical elixir that will allow you to live forever. She subsequently sold the rights to that elixir for $15,000,000 and have invested that money at 10% interest. The expected inflation rate is 2.5% forever. Finally, Alex wish to pay for your daughter's wedding which she estimate will occur in 25 years. Measured in today's dollars, She plan to spend $500,000 on the wedding. Assuming that Alex plan to never work again and that she wish to have the same purchasing power each year (excluding the wedding cost) during your retirement, what is the maximum amount Alex can withdraw during her first year of retirement? For simplicity, assume that the first withdrawal will occur in one year, the second in two years, etc.

Reference no: EM132083306

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