A couple just got married and they both are 25 and plan to retire at 65, in 40 years. They want 200k at the end of each year in 20 years upon retirement. Currently they have 2k cash and expect 100k as a retirement bonus at the end of the 40 years from employer. Assume interest rate is 8%. What is the present value off at 65 of the annual payment of 200k at the end of 20 years? What’s the present value today when 25 of the annual payment of 200k. What’s the present value today of 2k of cash they have and the 100k bonus? What’s the present value today of the amount they need to save up to reach their goal for retirement? How much must they save at the end of each year for the next 40 years to reach their goal?
A couple just got married and they both are 25 and plan to retire at 65, in 40 years. They want 200k at the end of each year in 20 years upon retirement. Currently they have 2k cash and expect 100k as a retirement bonus at the end of the 40 years from employer. Assume interest rate is 8%. What is the present value off at 65 of the annual payment of 200k at the end of 20 years? What’s the present value today when 25 of the annual payment of 200k. What’s the present value today of 2k of cash they have and the 100k bonus? What’s the present value today of the amount they need to save up to reach their goal for retirement? How much must they save at the end of each year for the next 40 years to reach their goal?
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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A couple just got married and they both are 25 and plan to retire at 65, in 40 years. They want 200k at the end of each year in 20 years upon retirement. Currently they have 2k cash and expect 100k as a retirement bonus at the end of the 40 years from employer. Assume interest rate is 8%. What is the present value off at 65 of the annual payment of 200k at the end of 20 years? What’s the present value today when 25 of the annual payment of 200k. What’s the present value today of 2k of cash they have and the 100k bonus? What’s the present value today of the amount they need to save up to reach their goal for retirement? How much must they save at the end of each year for the next 40 years to reach their goal?
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