You Would Like to Have Enough Money Saved to Receive

Multiple Choice

You would like to have enough money saved to receive a $50,000 per year perpetuity after retirement. How much would you need to have saved in your retirement fund to achieve this goal? (Assume that the perpetuity payments start on the day of your retirement. The annual interest rate is 8 percent.)

A) $1,000,000
B) $675,000
C) $625,000
D) $500,000