Question

Siri plans to retire in 5 years with 441,000 dollars in her account, which has an annual return of 15.69 percent. If she receives annual payments of X, with her first payment of X received in 5 years and her last payment of X received in 8 years, then what is X, the amount of each payment?

Answer 1

first we have to copute the future value of 441000 at the end of 5 year.
Put in calculator below
PV		441000
N		5
I		15.69%
PMT		0
Compute FV		($913,940.02)
therefore future value =			$913,940.02
Now we have to compute X .
Set in calculator at BEGIN mode and put below
PV		$913,940.02
N		3
I		15.69%
FV		0.00
Compute PMT		($349,963.45)
Therefore payment received=			$349,963.45
Note : we have assumed that payment is received till the beginning of the year 8