What should yearly savings be to achieve the given objective

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Question: Mr. Smith retires in exactly 20 years. At that time he desires to have accumulated enough money so that he can consume $100,000 per year for perpetuity starting at that time. He, furthermore, wishes to make equal payments to his account each period 20 payments in all. What should his yearly savings be to achieve these objectives, if the after tax return available to him is 15%?

Reference no: EM132004292

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