a. What is their annual shortfall at retirement assuming inflation of 3 percent per year? Click on the table icon to view the FVIF table: b. At the time that they retire, how much additional amount must they have accumulated to fund their retirement needs, assuming 3 percent inflation and a rate of return of 9 percent? Click on the table icon to view the PVIFA table: c. Calculate the additional amount that Peter and Blair must save each year for the next 29 years if they wish to completely fund their income shortfall. Click on the table icon to view the FVIFA table:
a. What is their annual shortfall at retirement assuming inflation of 3 percent per year? Click on the table icon to view the FVIF table: b. At the time that they retire, how much additional amount must they have accumulated to fund their retirement needs, assuming 3 percent inflation and a rate of return of 9 percent? Click on the table icon to view the PVIFA table: c. Calculate the additional amount that Peter and Blair must save each year for the next 29 years if they wish to completely fund their income shortfall. Click on the table icon to view the FVIFA table:
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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Question
Transcribed Image Text:Peter and Blair recently reviewed their future retirement income and expense projections. They hope to retire
in 29 years and anticipate they will need funding for an additional 20 years. They determined that they would
have a retirement income of $62,000.00 in today's dollars but that they would actually need $86,142.00 in
retirement income (in today's dollars) to meet all of their objectives.
a. What is their annual shortfall at retirement assuming inflation of 3 percent per year? Click on the table icon
to view the FVIF table:
b. At the time that they retire, how much additional amount must they have accumulated to fund their
retirement needs, assuming 3 percent inflation and a rate of return of 9 percent? Click on the table icon to view
the PVIFA table:
c. Calculate the additional amount that Peter and Blair must save each year for the next 29 years if they wish
to completely fund their income shortfall. Click on the table icon to view the FVIFA table:
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