Answer: he should deposit $120475 into the account.
Step-by-step explanation:
We would apply the periodic interest rate formula which is expressed as
P = a/{[(1+r)^n]-1}/[r(1+r)^n]
Where
P represents the amount that he can withdraw each month.
a represents the amount that he should deposit.
r represents the annual rate.
n represents number of monthly withdrawals. Therefore
r = 0.09/12 = 0.0075
n = 12 × 5 = 60
P = 2500
Therefore,
2500 = a/{[(1+0.0075)^60]-1}/[0.0075(1+0.0075)^60]
2500 = a/{1.566 -1}/[0.0075(1.566)]
2500 = a/{0.566}/[0.0075(1.566)]
2500 = a/(0.566/0.011745)
2500 = a/48.19
a = 2500 × 48.19
a = 120475
