A young engineer wishes to become a millionaire by the time she is 65 years old. She plans to make annual deposits, beginning on her 25th birthday and continuing through her 64th birthday. Assume that she can obtain a 8% rate of return per year. How much should each annual deposit be?

a. $2160
b. $2675
c. $3110
d. $3575

Annual deposit= $3,860.16

Explanation:

Giving the following information:

Future Value (FV)= $1,000,000

Number of peridos= 40 years

Interest rate (i)= 8%= 0.08

To calculate the annual deposit, we need to use the following formula:

FV= {A*[(1+i)^n-1]}/i

A= annual deposit

Isolating A:

A= (FV*i)/{[(1+i)^n]-1}

A= (1,000,000*0.08) / [(1.08^40) - 1]

A= $3,860.16

answer; the correct answer is (direct foreign investment);