SOLUTION: On the first day of the year, a man deposits $1000 in a bank at 8% per year, compounded annually. He withdraws $80 at the end of the first year, $90 at the end of the second year,

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Question 1008250: On the first day of the year, a man deposits $1000 in a bank at 8% per year, compounded annually. He withdraws $80 at the end of the first year, $90 at the end of the second year, and the remaining balance at the end of the third year. (a) How much does he withdraw at the end of the third year? (a) How much does he withdraw at the end of the third year? (b) what is his net cash flow (c) how much better off, in terms of net cash flow, would he have been if he had not made the withdraws at the ends of years one and two?
Answer by addingup(3677) About Me  (Show Source):
You can put this solution on YOUR website!
1000*.08= 80 so at the end of the first year, if you withdraw 80 you have your initial 1000. And another year 1000*.08= 80, if you withdraw 90 you will have 990. The third year you will have 990*.08= (use your calculator)