Finding the Maximum Annuity for a Given Investment in Java

Create QR Code in Java Finding the Maximum Annuity for a Given Investment

Another annuity calculation computes the maximum annuity (in terms of a regular withdrawal) available from a given investment over a specified period of time For example, if you have

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FIGURE 32-5

$500,000 in a retirement account, how much can you take out each month for 20 years, assuming a 6 percent rate of return The formula that computes the maximum withdrawal is shown here: Maximum Withdrawal = principal * ( ( (rateOfRet / wdPerYear) / ( 1 + ((rateOfRet / wdPerYear) + 1) wdPerYear * numYears) ) + (rateOfRet / wdPerYear) ) where rateOfRet specifies the rate of return, principal contains the value of the initial investment, wdPerYear specifies the number of withdrawals per year, and numYears specifies the length of the annuity in years The MaxWD applet shown next computes the maximum periodic withdrawals that can be made over a specified length of time for an assumed rate of return The applet produced by this program is shown in Figure 32-5

/* Compute the maximum annuity that can be withdrawn from an investment over a period of time */ import javaawt*; import javaawtevent*; import javaxswing*; import javatext*; /* <applet code="MaxWD" width=340 height=260> </applet> */ public class MaxWD extends JApplet implements ActionListener { JTextField maxWDText, orgPText, periodText, rateText, numWDText; JButton doIt; double principal; double rateOfRet; double numYears; int numPerYear; NumberFormat nf; // // // // initial principal annual rate of return length of time in years number of withdrawals per year

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public void init() { try { SwingUtilitiesinvokeAndWait(new Runnable () { public void run() { makeGUI(); // initialize the GUI } }); } catch(Exception exc) { Systemoutprintln("Can't create because of "+ exc); } } // Set up and initialize the GUI private void makeGUI() { // Use a grid bag layout GridBagLayout gbag = new GridBagLayout(); GridBagConstraints gbc = new GridBagConstraints(); setLayout(gbag); JLabel heading = new JLabel("Maximum Regular Withdrawals"); JLabel JLabel JLabel JLabel orgPLab = new JLabel("Original Principal "); periodLab = new JLabel("Years "); rateLab = new JLabel("Rate of Return "); numWDLab = new JLabel("Number of Withdrawals per Year "); JLabel maxWDLab = new JLabel("Maximum Withdrawal "); maxWDText = new JTextField(10); periodText = new JTextField(10); orgPText = new JTextField(10); rateText = new JTextField(10); numWDText = new JTextField(10); // Max withdrawal field for display only maxWDTextsetEditable(false); doIt = new JButton("Compute"); // Define the grid bag gbcweighty = 10; // use a row weight of 1 gbcgridwidth = GridBagConstraintsREMAINDER; gbcanchor = GridBagConstraintsNORTH; gbagsetConstraints(heading, gbc); // Anchor most components to the right gbcanchor = GridBagConstraintsEAST; gbcgridwidth = GridBagConstraintsRELATIVE; gbagsetConstraints(orgPLab, gbc); gbcgridwidth = GridBagConstraintsREMAINDER; gbagsetConstraints(orgPText, gbc);

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gbcgridwidth = GridBagConstraintsRELATIVE; gbagsetConstraints(periodLab, gbc); gbcgridwidth = GridBagConstraintsREMAINDER; gbagsetConstraints(periodText, gbc); gbcgridwidth = GridBagConstraintsRELATIVE; gbagsetConstraints(rateLab, gbc); gbcgridwidth = GridBagConstraintsREMAINDER; gbagsetConstraints(rateText, gbc); gbcgridwidth = GridBagConstraintsRELATIVE; gbagsetConstraints(numWDLab, gbc); gbcgridwidth = GridBagConstraintsREMAINDER; gbagsetConstraints(numWDText, gbc); gbcgridwidth = GridBagConstraintsRELATIVE; gbagsetConstraints(maxWDLab, gbc); gbcgridwidth = GridBagConstraintsREMAINDER; gbagsetConstraints(maxWDText, gbc); gbcanchor = GridBagConstraintsCENTER; gbagsetConstraints(doIt, gbc); // Add all the components add(heading); add(orgPLab); add(orgPText); add(periodLab); add(periodText); add(rateLab); add(rateText); add(numWDLab); add(numWDText); add(maxWDLab); add(maxWDText); add(doIt); // Register to receive action events orgPTextaddActionListener(this); periodTextaddActionListener(this); rateTextaddActionListener(this); numWDTextaddActionListener(this); doItaddActionListener(this); // Create a number format nf = NumberFormatgetInstance(); nfsetMinimumFractionDigits(2); nfsetMaximumFractionDigits(2); } /* User pressed Enter on a text field or pressed Compute Display the result if all fields are completed */ public void actionPerformed(ActionEvent ae) { double result = 00;

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orgPStr = orgPTextgetText(); periodStr = periodTextgetText(); rateStr = rateTextgetText(); numWDStr = numWDTextgetText();

try { if(orgPStrlength() != 0 && periodStrlength() != 0 && rateStrlength() != 0 && numWDStrlength() != 0) { principal = DoubleparseDouble(orgPStr); numYears = DoubleparseDouble(periodStr); rateOfRet = DoubleparseDouble(rateStr) / 100; numPerYear = IntegerparseInt(numWDStr); result = compute(); maxWDTextsetText(nfformat(result)); } showStatus(""); // erase any previous error message } catch (NumberFormatException exc) { showStatus("Invalid Data"); maxWDTextsetText(""); } } // Compute the maximum regular withdrawals double compute() { double b, e; double t1, t2; t1 = rateOfRet / numPerYear; b = (1 + t1); e = numPerYear * numYears; t2 = Mathpow(b, e) - 1; return principal * (t1/t2 + t1); } }