The quarterly deposit must be $1,618.

First we compute the present value of the stream of payments. There are in total 4 withdrawals, each is six month apart. The nominal interest is 8% compounded quarterly, the effective quarterly rate is 8%/4 = 2%. The effective semi-annual rate is (1+2%)2−1=4.04(1+2%)2−1=4.04

At this discount rate, the present value is ∑4t=12500(1+4.04%)t=$9,066.∑t=142500(1+4.04%)t=$9,066.

Let the quarterly deposit be D, there are 6 quarters within the next two years. To support the withdrawals, the present value of the deposits must be $9,066, i.e., ∑6t=1D(1+2%)t=$9,066∑t=16D(1+2%)t=$9,066, which yields D = $1,618.