1. Steven White is considering taking early retirement, having saved $400,000. White desires to determine how many years the savings will last if $40,000 per year is withdrawn at the end of each year. White feels the savings can earn 10 percent per year.
2. Suppose today is July 1, 2010, and you deposit $2,000 into an account today. Then you deposit $1,000 into the same account on each July 1, beginning in 2011 and continuing until the last $1,000 deposit is made on July 1, 2016. Also, assume that you withdraw $3,000 on July 1, 2018. Assuming a 7 percent annual compound interest rate, what will be the balance in the account at the close of business on July 1, 2020?