Suppose that Scott Andrews deposits his $10,500 bonus in an account that earns an annual rate of 7.0%, compounded quarterly, and makes additional deposits of $700 at the end of each quarter for the next 24.5 years, until he retires. To supplement his retirement, Scott wants to make withdrawals at the end of each quarter for the next 15 years (at which time the account balance will be $0). What is the total amount withdrawn? Assume the interest rate remains the same during Scott's retirement. Round your answer to the nearest cent.
A)$1,083,705.25
B)$248,930.60
C)$263,347.98
D)$296,223.11
E)$383,855.34

Question

Suppose that Scott Andrews deposits his $10,500 bonus in an account that earns an annual rate of 7.0%, compounded quarterly, and makes additional deposits of $700 at the end of each quarter for the next 24.5 years, until he retires. To supplement his retirement, Scott wants to make withdrawals at the end of each quarter for the next 15 years (at which time the account balance will be $0). What is the total amount withdrawn? Assume the interest rate remains the same during Scott's retirement. Round your answer to the nearest cent. ​
A)$1,083,705.25
B)$248,930.60
C)$263,347.98
D)$296,223.11
E)$383,855.34

Quizplus · Accepted Answer

The future value of the account at retirement is calculated using the formula for compound interest with additional periodic deposits. Then, the annuity formula is used to determine the total amount withdrawn over 15 years, ensuring the account balance reaches $0.

Suppose That Scott Andrews Deposits His $10,500 Bonus in an Account