SOLUTION: Molly wishes to withdraw $350 at the end of every month for 10 years. If the money earns 7% compounded monthly, how much should she deposit now?

Question 979469: Molly wishes to withdraw $350 at the end of every month for 10 years. If the money earns 7% compounded monthly, how much should she deposit now?
Answer by Boreal(15235) (Show Source): You can put this solution on YOUR website!
Annuity Formula
A=(P/r) {1- (1+r)^-t}; P= what she deposits, r=rate, divided by 12 to make it a monthly rate; 120 the number of months in 10 years.
=[(350/(.07/12)] {1-(1+(.07/12)}^-120
=60,000*{1-(1+.0058333)^-120); the exponent term is 0.4976, rounded
=$29855.78, rounding at the end.
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