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The question in the image asks:

> "You have $500,000 saved for retirement. Your account earns 10% interest. How much will you be able to pull out each month, if you want to be able to take withdrawals for 25 years?"

This problem involves calculating a monthly withdrawal amount for a retirement account using an annuity formula, considering the given interest rate and time period.

To solve this, we can use the **Present Value of an Annuity formula**:

\[
P = \frac{W \cdot \left(1 - (1 + r)^{-n}\right)}{r}
\]

where:
- $ P $ = present value of the account (initial savings) = $500,000,
- $ W $ = monthly withdrawal amount (what we want to find),
- $ r $ = monthly interest rate = $\frac{10\%}{12}$ or 0.10/12,
- $ n $ = total number of withdrawals = $25 \times 12$ months.

Rearrange the formula to solve for $ W $:

\[
W = \frac{P \cdot r}{1 - (1 + r)^{-n}}
\]

Let’s plug in the values:

1. **$ P = 500,000 $**
2. **$ r = \frac{0.10}{12} \approx 0.0083333 $**
3. **$ n = 25 \times 12 = 300 $**

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You have $500,000 saved for retirement. Your account earns 10% interest. How much will you be able to pull out each month, if you want to be able to take withdrawals for 25 years?

Learn how to calculate monthly withdrawals from a $500,000 retirement account with a 10% annual interest rate, planned over 25 years. This problem uses the Present Value of Annuity formula to determine monthly payouts, covering essential concepts in annuities and interest rates. Suitable for college-level students studying finance or personal finance.

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