You plan on withdrawing monthly payments for the next ten years and have deposited $100,000 inan account. If the rate of return is 8% compounded monthly, determine the value of the monthlywithdrawals.Possible answers: A) $1,613.28 B) $1,413.28 C) $1,213.28 D) $2,013.28 E) $1,813.28

You plan on withdrawing monthly payments for the next ten years and have deposited $100,000 inan account. If the rate of return is 8% compounded monthly, determine the value of the monthlywithdrawals.Possible answers: A) $1,613.28 B) $1,413.28 C) $1,213.28 D) $2,013.28 E) $1,813.28

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 6MC: You want to invest $8,000 at an annual Interest rate of 8% that compounds annually for 12 years....

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Question

You plan on withdrawing monthly payments for the next ten years and have deposited $100,000 in
an account. If the rate of return is 8% compounded monthly, determine the value of the monthly
withdrawals.
Possible answers: A) $1,613.28 B) $1,413.28 C) $1,213.28 D) $2,013.28 E) $1,813.28

Definition Definition Percentage gain or loss from a specific investment over time. The rate of return is the difference between the closing and initial values of an investment divided by the initial value of the investment. The closing value includes any intermediate cash flows such as dividends or interest amounts.

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