Alexandra is 30 years old today, and she is planning to retire at age 65. Her current salary is $65,000 and she expects her salary to increase at a rate of 5% per year as long as she works. To save for her retirement, she plans on making annual contributions to a retirement account. Her first contribution will be made next year on her 31 st birthday and it will be 10% of her salary. She will also deposit 10% of her salary each year until she reaches age 65, If the rate of interest on her retirement saving account is 8%, how much will Alexandra have in her retirement account when she reaches the age of 65? O a) $252,625.85 O b) $2,108,772.30 c) $1,968,600.20 d) $925,067.00 O e) $1,567,923.12

Alexandra is 30 years old today, and she is planning to retire at age 65. Her current salary is $65,000 and she expects her salary to increase at a rate of 5% per year as long as she works. To save for her retirement, she plans on making annual contributions to a retirement account. Her first contribution will be made next year on her 31 st birthday and it will be 10% of her salary. She will also deposit 10% of her salary each year until she reaches age 65, If the rate of interest on her retirement saving account is 8%, how much will Alexandra have in her retirement account when she reaches the age of 65? O a) $252,625.85 O b) $2,108,772.30 c) $1,968,600.20 d) $925,067.00 O e) $1,567,923.12

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 10P

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