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
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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Transcribed Image Text: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
Ob) $2,108,772.30
c) $1,968,600.20
d) $925,067.00
e) $1,567,923.12
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