Harry Rawlings wants to withdraw $10,000 (including principal) from an investment fund at the end of each year for 5 years. How should he compute his required initial investment at the beginning of the first year if the fund earns 6% compounded annually?

$44,651.06

Explanation:

We use the Present value function for this question. The calculation is shown in the attached spreadsheet

Data are given in the question

Future value = $0

Rate of interest = 6%

NPER = 5 years

PMT = $25,000

The formula is shown below:

= PV(Rate;NPER;-PMT;FV;type)

After solving this, the present value is $44,651.06

import java.util.*;

import java.text.*;

class CreditCardBill

{

public static void main(String[] args)

{

Scanner sc = new Scanner(System.in);

NumberFormat defaultFormat = NumberFormat.getCurrencyInstance(Locale.US);

System.out.println("CS Card International Statement");

System.out.println("");

System.out.print("Previous Balance: $");

double prevBalance = sc.nextDouble();

System.out.print("Additional Charges: $");

double addCharges = sc.nextDouble();

double interest;

if(prevBalance == 0)

interest = 0;

else

interest = (prevBalance + addCharges) * 0.02;

System.out.println("Interest: "+defaultFormat.format(interest));

double newBalance = prevBalance + addCharges + interest;

System.out.println("New Balance: "+defaultFormat.format(newBalance));

double minPayment;

if(newBalance < 50)

minPayment = newBalance;

else if(newBalance <= 300)

minPayment = 50.00;

else

minPayment = newBalance * 0.2;

System.out.println("Minimum Payment: "+defaultFormat.format(minPayment));

}

}