CRITICAL THINKING You are saving money for
retirement. You plan to withdraw $30,000 at the
beginning of each year for 20 years after you retire.
Based on the type of investment you are making, you
can expect to earn an annual return of 8% on your
savings after you retire.
a. Let a be your balance n years after retiring. Write
a recursive equation that shows how an is related
to an-1
b. Solve the equation from part (a) for a, -1-
Find ao, the minimum amount of money you
should have in your account when you retire.
(Hint: Let a=0.)