a 20 year old college student wants to save $3 a day for her retirement. Every day she places $3 in a drawer. At the end of the year, she invests the accumulated savings ($1095) in a brokerage account with an expected annual return of 12%. 1) how much will she have when she is 65 years old? (Draw a timeline and use both the formula and financial calculator methods) 2) How much must a 40 year old investor needs to deposit annually to catch the 20 year old when the investor becomes 65 years old? (draw a time line and use both the the formula and financial calculator methods)
a 20 year old college student wants to save $3 a day for her retirement. Every day she places $3 in a drawer. At the end of the year, she invests the accumulated savings ($1095) in a brokerage account with an expected annual return of 12%. 1) how much will she have when she is 65 years old? (Draw a timeline and use both the formula and financial calculator methods) 2) How much must a 40 year old investor needs to deposit annually to catch the 20 year old when the investor becomes 65 years old? (draw a time line and use both the the formula and financial calculator methods)
Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)
7th Edition
ISBN:9780357033609
Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Chapter14: Planning For Retirement
Section: Chapter Questions
Problem 2FPE
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a 20 year old college student wants to save $3 a day for her retirement. Every day she places $3 in a drawer. At the end of the year, she invests the accumulated savings ($1095) in a brokerage account with an expected annual return of 12%.
1) how much will she have when she is 65 years old? (Draw a timeline and use both the formula and financial calculator methods)
2) How much must a 40 year old investor needs to deposit annually to catch the 20 year old when the investor becomes 65 years old? (draw a time line and use both the the formula and financial calculator methods)
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