Question

You estimate that by the time you retire in 35 years, you will have accumulated savings of $2.9 million. a. If the interest rate is 8.0% and you live 15 years after retirement, what annual level of expenditure will those savings support

Answer 1

$338,805.68

Step-by-step explanation:

The computation of the amount of annual level of expenditure is shown below

Here we use the PMT formula

Given that

NPER = 15

RATE = 8%

FV = $0

PV = $2,900,000

The formula is shown below:

= PMT(RATE, NPER,-PV,FV,TYPE)

The present value comes in negative

After applying the above formula, the amount of annual level of expenditure is $338,805.68