Mr and Ms Houghton want to set up an account that will generate sufficient interest on retirement to generate $1200 to meet their basic living expenses.
A) find the future amount nessessary that will generate $1200 per month if they can get 5.15% interest compounded monthly on those monies.
B) find out he monthly payment they would have to make into an ordinary annuity to obtain the future value foo d in part a). If there annuity money earns 7.65% monthly compound interest and the term is 25 years.