Seth has a bank account which pays 1.01% interest, compounded quarterly. Seth withdraws $4,567 from the account every quarter for 35 years. Assuming that Seth does not make any deposits into this account and that the withdrawals occur at the end of every quarter, find the initial value of the account, rounded to the nearest cent.

Because the withdrawals happen at the end of each quarter, their initial value is the present value of an ordinary annuity. The quarterly interest rate is 0.0101 ÷ 4 = 0.002525, and there are 35 × 4 = 140 withdrawals. Using PV = 4567[1 − (1.002525)^−140] ÷ 0.002525 gives about $538,021.66, so the initial account value is choice C, $538,021.66.

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