You invested $2m today in an account that is expected to earn 15% annually for the next five years. As a result of this investment, the account will pay you the same amount $Y per year for the next five years, after which you will have $0 in the account. At the end of year 1, what is the balance in the account after the withdrawal of the first $Y?
You invested $2m today in an account that is expected to earn 15% annually for the next five years. As a result of this investment, the account will pay you the same amount $Y per year for the next five years, after which you will have $0 in the account. At the end of year 1, what is the balance in the account after the withdrawal of the first $Y?
Chapter5: The Time Value Of Money
Section: Chapter Questions
Problem 16P
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You invested $2m today in an account that is expected to earn 15% annually for the next five years. As a result of this investment, the account will pay you the same amount $Y per year for the next five years, after which you will have $0 in the account. At the end of year 1, what is the balance in the account after the withdrawal of the first $Y?
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