How many years will rodman be able to receive payments

Reference no: EM13839897

Under the NBA deferred compensation plan, payments made at the end of each year accumulate up to retirement and then retirees are given two options. Option 1 allows the retiree to select the amount of the annual payment to be received, and option 2 allows the retiree to specify over how many years payments are to be received. Assume Rodman has had $6,800 deposited at the end of each year for 30 years, and that the long-term interest rate has been 8%.

(FV of $1 PV of $1, FVA of $1. PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)

Required:

a. How much has accumulated in Rodman's deferred compensation account?

b. How much will Rodman be able to withdraw at the beginning of each year if he elects to receive payments for 16 years?

c. How many years will Rodman be able to receive payments if he chooses to receive $73.000 per year at the beginning of each year?

Reference no: EM13839897

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