What Amount Would You Have to Invest Now at 7

question 53

Multiple Choice

What amount would you have to invest now at 7% compounded annually in order to make withdrawals of $20,000 once per year for 25 years? The first withdrawal is to be made one year from now.

• A) $233,072
• B) $1,264,981
• C) $544,343
• D) $197,226
• E) $427,561

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Definitions:

7 Months

A period of time equivalent to approximately 213 to 217 days, often referred to in the context of age or development stages.

Umbilical Cord

A life-support system that contains two arteries and one vein and connects the baby to the placenta.

Single Vein

Refers to a singular blood vessel that carries blood towards the heart, often used in botanical or anatomical contexts.

Two Arteries

Refers to the presence of two major arteries, typically in context of human anatomy, biology, or when discussing vascular systems in general.