Average return of the retirement account


Question:

My friend, Jane, would like to retire by December 31, 2008. She is wondering whether she can withdraw $100,000 every year forever. How much her nest egg should be assuming the average return of her retirement account is 10%? Would you help her to figure it out?

What present value formula would you use to figure out the answer?

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Finance Basics: Average return of the retirement account
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