Question

An engineer who invested very well plans to retire now because she has $2,000,000 in her ORP account. How long will she be able to withdraw $100,000 per year (beginning 1 year from now) if her account earns interest at a rate of 4% per year?

Answer 1

20 years

Step-by-step explanation:

You do 2,000,000 ÷ 100,000 but you can simplify that to 20 ÷ 1 = 20

During those 20 years, the profits you earn will be 80,000 since when you do 2,000,000 x 0.04 but you can simplify that to 20,000 x 4 getting 80,000 and that quite doesn't reach 100,000 dollars