Withdrawal Rate for Endowments

Alice is the Chief Investment Officer of a university endowment fund. One of her primary responsibilities is to oversee the investment strategy that balances generating sufficient returns to support the university's operations while preserving the purchasing power of the fund’s assets. Recently, she participated in a board meeting where there was a discussion about the appropriate withdrawal rate from the fund.

In this context, which of the following withdrawal rates would be most consistent with the long-term growth objectives of a foundation or endowment?