2. Marjorie Yan recently retired fromwork and wants to use a portion ofher retirement money for investment.She has two investment options,namely (1) a bond fund, and (2) astock fund. Each investment wouldbe for one year and will give a returnto of 6% for the bond fund and 10%for stock fund. Whatever portion ofher retirement money she commitsfor investment, she wants to invest atleast 25% of that amount in the bondfund. Moreover, she wants to select amix that will give her a total return ofat least 7.5%. Marjorie wants todetermine the percentage thatshould be allocated to each possibleinvestment alternative to maximize*returns.1 Add File

Marjorie Yan has retired and wanted to invest the funds here the bond fund gives return of 6% and…

Answered: 2. Marjorie Yan recently retired from…

2. Marjorie Yan recently retired from work and wants to use a portion of her retirement money for investment. She has two investment options.

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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1a. Shelly and Mark wanted to review their retirement preparation and make sure they are on track. Shelly currently has 229k in her 401k. She has an income of 132k a year. She is contributing 18% to her 401k and has an employer match of an additional 4%. Her husband Mark has been unemployed, but just stared a new job making 100k a year. He has 70k in an old 401k from a previous employer. With his new job he is planning to contribute 10% and has a company match that pays an additional 3%. They plan to retire in 22 years when Mark is 65 and Shelly will be 62. How much will they have in retirement savings if they earn 6% on their investments? 1b. If they plan to take 4% out a year what would their income be in the first year of retirement? 2a. Terry is doing some retirement planning. He is 60 years old and wanting to retire at age 65. He has about $290k in retirement savings. He just finished paying off his home and wants to now focus on saving for retirement. He has a very…
Question 2 (. (a) Laura Smith is planning for her and her husband Luke's retirement. Luke and Laura, born on the same date, expect to retire in 30 years (when they both turn 65). The life expectancy of men is 78 years and the life expectancy of women is 87 years (i.e., assume that they die the day before their 78ih or 87th birthday). During retirement (while they are living), the couple wants to withdraw $25,000, for each of them, at the beginning of each year from their savings account. Assume that the interest rate during their retirement is annually; the interest rate after Luke dies is the interest rate, prior to retirement, is 8 percent compounded annually. How much will they have to deposit in their joint savings account (combine Luke and Laura) each month (beginning one month from now and ending on their retirement date)? 12 2 percent compounded semi- 13 percent compounded annually; and, (b) Now assume that Luke and Laura Smith expect to inherit $25,000, 5 years from now. If…
I need answers for Question a,b,c,d
30 After reviewing her financial affairs, Jasmine has determined that she would like the $75,000 death benefit from one of her insurance policies to go to a local registered charity. The whole life policy in question has a $45,000 cash surrender value (CSV) and she pays an annual premium of $500. Jasmine's current cash flow situation is quite good. She is living a comfortable retirement. However, she is worried as she has assets, that of the taxes that will be payable after her death will result in considerable capital gains. She is unable to purchase a new life insurance to cover the income tax triggered at death because of her health. What should Jasmine do to fulfill her desire to donate $75,000 to the registered charity and alleviate the taxes payable following her death? NVBDQncreUJQWW1 Ya0w4cWZjYVhIQT09 → a. O Surrender the life insurance policy and donate the CSV. b. O Name the registered charity as beneficiary of the life insurance policy. c. O Assign the life insurance policy…
Question 27 of 50. Mark and Carrie are married, and they will file a joint return. They both work full-time, and their 2021 income totaled $89,000, all from wages. They have one dependent child, Aubrey (5). During the year, they spent $9,000 for Aubrey's child care. Neither Mark nor Carrie received any dependent care benefits from their employer. What amount may they use to calculate the Child and Dependent Care Credit? $0 $3,000 $8,000 $9,000 Mark for follow up
Sam is currently 30 years of age. He owns his own business and wantsto retire at the age of 60. He has little confidence in the current SocialSecurity system. He wants to retire with an annual income of $72,000a year.a. If Sam believes he will live to age 90, how much does he have to accumulateby the time he reaches age 60 to receive $72,000 at the end of each yearfor the rest of his life? Sam believes he can earn 8 percent on his money in astock mutual fund.b. How much does he have to accumulate if he wants the payment of $72,000at the beginning of each year?c. What dollar amount of interest will Sam have earned during retirement if hereceives his $72,000 at the beginning of each year?
A small strip mining cola company is trying to decide whether it should purchase or lease a new clamshell. If purchased, the shell will cost $150,000 and is expected to have a $65,000 salvage value after 6 years. Alternatively, the company can lease a clamshell for $20,000 per year, but the lease payment will have to be made at the beginning of each year. If the clamshell is purchased, it will be leased to other strip-mining companies whenever possible, an activity that is expected to yield revenue of $12,000 per year. If the company’s MARR is 15% per year, should the clamshell be purchased or leased on the basis of future worth analysis. (Enter the FW value of the selected alternative with proper positive or negative sign)
Edwards company just hired another employee Jane, the Edwards company provides supplemental retirement benefits to its employees realizing the insufficiency of the Social Security benefits or comfortable retirement life Edwards has asked you to perform the necessary computations pertaining to the retirement benefit for Gene. Jane’s current salary is $40,000. Jane will be entitled to the supplementary retirement benefits after 20 years of work the start of the 21st year The retirement plan will last for 25 years per company practices Jane will be granted with a year and salary increase of 2% per year effective January 1 of each year that she works the amount of annual retirement benefit is going to be 45% of James salary right before the start of the retirement and will be paid at the start of each year. Any invested funds for pension will earn 4% compounded annually, compute Jane’s annual retirement benefit. Assume James’s retirement benefit is $32,000 what amount must be on deposit…
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Upon Jena’s retirement, the couple plans to relocate their home close to the beach. For this purpose, they intend to buy a house near the beach and a rental property (to fund their retirement). They do not have the funds to make these purchases. Please explain to the couple the downsizing retirement strategy most appropriate to their circumstance.
Amount of Insurance Needed. Peter is married and has two children. He wants to be sure that he has sufficient life insurance to take care of his family if he dies. Peter's wife is a homemaker but attends college part-time pursuing a law degree. It will cost approximately $40,000 for her to finish her education. Because the children are teenagers, Peter feels he will only need to provide the family with income for the next ten years. He further calculates that the household expenses run approximately $61,600 per year excluding the mortgage payments. The balance on the home mortgage is $ 125,000. Peter set up a college fund for his children when they were babies, and it currently contains sufficient funds for them to attend college. Assuming that Peter's wife can invest the insurance proceeds at 9%, calculate the amount of insurance Peter needs to purchase. The amount of life insurance Peter would need to purchase is?
Bonnie is getting close to retirement and realizes she has three different IRA accounts at three different financial institutions. To make life simpler, Bonnie wishes to con-solidate her three IRAs into a single account in 2018 using trustee-to-trustee direct rollovers. How many rollovers of this type can Bonnie make in 2018? a. One b. Two c. Four d. Ten e. There is no limit

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