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Springfield mogul Montgomery Burns, age 80 , wants to retire at age 100 so he...

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Finance

Springfield mogul Montgomery Burns, age 80 , wants to retire at age 100 so he can steal candy from babies full-time. Once Mr. Burns retires, he wants to withdraw $1.2 billion at the beginning of each year for 10 years from a special offshore account that will pay 18 percent annually. In order to fund his retirement, Mr. Burns will make 20 equal end-of-the-year deposits in this same special account that will pay 18 percent annually. How much money will Mr. Burns need at age 100, and how large of an annual deposit must he make to fund this retirement account?

a.If the retirement account will pay 18 percent annually, how much money will Mr. Burns need when he retires?

b.How large of an annual deposit must he make to fund this retirement account?

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