2. Pretend that today is your birthday and you decide to start saving for your retirement. You will retire on your 65th birthday and need $4,000 per month for the next 20 years, increasing $100 per month after the first month. You will make your first withdrawal on your 65th birthday, the day you retire. You will make the first deposit today in an account paying 7% interest compounded daily, and continue to make the same $123.07 equal weekly deposits up to your 60th birthday, then you stop making deposits. What birthday are you celebrating today? Create a cash flow diagram.

2. Pretend that today is your birthday and you decide to start saving for your retirement. You will retire on your 65th birthday and need $4,000 per month for the next 20 years, increasing $100 per month after the first month. You will make your first withdrawal on your 65th birthday, the day you retire. You will make the first deposit today in an account paying 7% interest compounded daily, and continue to make the same $123.07 equal weekly deposits up to your 60th birthday, then you stop making deposits. What birthday are you celebrating today? Create a cash flow diagram.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter17: Financial Markets

Section: Chapter Questions

Problem 25RQ: How is buying a house to live in a type of financial investment?

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