6. Adrianna wants to provide retirement income for her dependent parents for 23 years should she die. Adriana earns $67,500 and feels that her parents could live on 70% of that amount. If the insurance funds could be invested at 5.5%, how much life insurance does Adrianna purchase using the desired income method?

6. Adrianna wants to provide retirement income for her dependent parents for 23 years should she die. Adriana earns $67,500 and feels that her parents could live on 70% of that amount. If the insurance funds could be invested at 5.5%, how much life insurance does Adrianna purchase using the desired income method?

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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Similar questions

Christina is planning on buying an insurance policy that will pay for $157,250 a year for 25-years, with the first payment occurring in 15 years, if she is still alive, otherwise the policy will payout a lump sum to her heirs at the end of year 14. The rate of return on the policy is5.5 percent? What is the value of the lump payout? If Christina purchases the policy, what is the maximum she is willing to pay?
Anny’s full retirement age is 66 years and 2 months. Her PIA at full retirement age is $1200. She wants to retire early and receive the benefit at age 63. (a). How many months does she retire earlier than full retirement age (in months). __________months (b).What's the percentage of reduction in her retirement benefit (in %, keep two decimals if applicable). __________% (c). What’s her monthly benefit if she retires early and starts to receive the benefit at age 63 (in $, keep two decimals if applicable)? $_____________
Maria and Roberto Cruz's financial adviser told them they will need 80 percent of their preretirement income to live comfortably. Their annual preretirement income is $75,000. What will their annual retirement income need to be?
After the birth of your first child, you decide to buy a life insurance policy for yourself but can't decide how much to buy. In the event of your untimely death, you estimate that the life insurance money can be invested in an account earning 8% interest compounded monthly. You would like your child to get a monthly payment of $1,500.00 for 18 years.How much should your life insurance policy be worth in order to achieve your goal? I should get a life insurance policy that is worth $_______
Bridgette can afford to make monthly payments of $800 towards a mortgage, and wants to fully own her home within 30 years. Given an interest rate of 10.5% on her mortgage, what's the highest value of a home she can afford?
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Jasmine has decided that she wants to build enough retirement wealth that, if invested at 6 percent per year, will provide her with $3,000 of monthly income for 30 years. To date, she has saved nothing but she still has 25 years until she retires. Jasmine believes that she can earn 6 percent on her investments until she retires. How much money does she need to contribute per month to reach her goal? O $512.93 O $863.49 O $616.27 O $722.05
You want your daughter to be a millionaire. She is 3 years old today when you deposit $42,000 in an account that earns 8.2% per year. The funds in the account will be distributed to your daughter whenever the total reaches $1,000,000. How old will your daughter be when she gets the money?
Taylor Jones has a Insurance policy that returns every cent she pays in premiums if she outlives the term of the policy. She knows this policy costs 30 to 50 percent more than a traditional policy but thinks it is worth it. What type of term life insurance does Taylor have?
Nikul
Manya and Sarah are both starting out in their careers. They choose two different paths to saving in their 401k accounts for their retirements. Manya is 23 years old and decides to start depositing $400 monthly in her 401k which will earn 9.5% APR. Manya will retire at the age of 70. a) How many years will Manya be saving money in her 401k? years b) How much will be in Manya's 401k when she retires? c) How much will Manya have deposited herself over her years of working from her salary? d) How much will Manya have earned in interest over her years of working? Sarah waits to begin depositing money into a 401k (for various reasons that seemed important at the time...) until she was 40 years old. She decides to deposit twice as much as Manya per month hoping to catch up. Assume that Sarah gets the same 9.5% APR and will retire at the same age of 70. e) How many years will Sarah be saving money in her 401k. years f) How much will Sarah be depositing in her account each month? g) How much…
After retiring, Amina wants to be able to withdraw $30,500.00 every year from her account for 25 years. Her account earns 9% interest compounded annually.How much does Amina need in her account when she retires? Amina needs$________ in her account when she retires. How much total money will Amina pull out of her account? In total, Amina will pull out $________ from her account. How much of that money is interest? The amount of money that is interest is$________ .

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