Question
An engineer is on the verge of retirement. She saved $ 100,000 which is deposited in...
An engineer is on the verge of retirement. She saved $ 100,000 which is deposited in an account that pays 6% interest per year capitalized quarterly. His plan is to withdraw $ 6,000 per quarter to satisfy his needs. In how many years will she use up her savings?
Homework Answers
Answer #1
We are given the following information:
| Quarterly payment | PMT | $ 6,000.00 |
| rate of interest | r | 6.00% |
| number of years | n | To be calculated |
| Quarterly Compounding | frequency | 4 |
| Present value | PV | $ 100,000.00 |
We need to solve the following equation to arrive at the required n
So the number of years are 4.83 years of 19.32 quarters
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