Use the Present Value and Future Value Tables Included in Appendix

Use the present value and future value tables included in Appendix 8 and on the textbook companion website.
- An investor wants to withdraw $8,000 (including principal) from an investment fund at the end of each year for 10 years. How should the investor compute the required initial investment at the beginning of the first year if the fund earns 10 percent compounded annually?

A) $8,000 times the amount of an annuity of $1 at 10 percent at the end of each year for 10 years
B) $8,000 divided by the amount of an annuity of $1 at 10 percent at the end of each year for 10 years
C) $8,000 times the present value of an annuity of $1 at 10 percent at the end of each year for 10 years
D) $8,000 divided by the present value of an annuity of $1 at 10 percent at the end of each year for 10 years

Correct Answer:

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