At age 25, you start work for a company and are offered two retirement options.Retirement option 1: When you retire, you will receive a lump sum of $30,000 for each year of service.At age 59, option 1 will provide a retirement benefit of what amount?esc$At age 59, option 2 will provide a retirement benefit of what amount? Round your answer to the nearest whole dollar.$Retirement option 2: When you start to work, the company deposits $15,000 into an account with an APR of 12% compounded monthly. When you retire, you getthe balance of the account.Which option is better if you retire at age 59?O retirement option 1retirement option 2At age 69, option 1 will provide a retirement benefit of what amount?$At age 69, option 2 will provide a retirement benefit of what amount? Round your answer to the nearest whole dollar.$Which option is better if you retire at age 69?retirement option 1O retirement option 2DF1F2ㅁㅁ 13F35F4JULDDŹ BOF5♫MacBook AirF68F7tv NA▶11F8QUANT REASONING(105A-900), Sum...F9NDWF10F11F12

Compound Interest: It is the interest earned on interest. It is calculated depend on initial…

Answered: At age 25, you start work for a company…

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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Suppose you plan to retire in 40 years. If you make annual contributions of $12,000 into your retirement account for the first 8 years, and no more contributions to the account for the remaining 32 years. If the retirement account earns a fixed 6% annual interest, how much will you have at your retirement? Question 10 options: $739,166 $766,466 $793,766 $811,766 $829,766 $851,966
A policyholder wishes to receive $5,000 per month in retirement. They plan to retire at the age of 64, the insurer is guaranteeing a 4% rate of return, and their life expectancy is 86. If they deposit each of the following amounts annually before retiring, at what age do they need to start saving? (A).$10,000 25 years old (technically, 25.60759 years old) (B).$15,000 33 years old (technically, 33.26361 years old) (C).$20,000 38 years old (technically, 38.17201 years old) (D).$25,000 41 years old (technically, 41.64589 years old)
Hi there, how do i calculate this without using excel? Information: Your pension is reduced by 0.6% of the monthly payment for every month before age 65 that you receive pension payments. You are currently 60 years old and plan to die at 85. Retirement options: Option 1: Make $1364.6 per month if you start your CPP at age 65. If you take CPP starting at age 60, Option 2: Delay taking your CPP benefits until after 65, your monthly income will increase by0.7% for each month that you delay, up until age 70. Discount rate is .04 per month Question: what is the present value at age 60 of your CPP payments if you begin taking them at age 65? What is the present value at age 60 of your CPP payments if you begin taking them at age 70?
At age 20, you begin depositing $50 each month into a savings account with an APR of 5% compounded monthly. At age 40, your employer begins to deposit $300 a month into an account with an APR of 6% compounded monthly. If you continue to make your $50 monthly deposits, what will your total nest egg be by 4. age 65?
You have to decide whether or not to participate in the employer match program at your work. If you place 8% of your gross pay into a retirement account, your employer will match it. You plan to retire in 30 years. You expect to earn 6% return on your investment. How much will you have in the account if your average annual gross salary is $50,000? A. $316,232.80 B. $22,973.96 C. $45,947.92 D. $632,465.60 Using the same information as the previous question, assume that you want to increase your portion of the contribution to 10%. The employer will only match up to 8%. How much would you have in this situation? A. $692,523.80 B. $711,523.80 C. $316,232.80 D. $632,465.60
Your employer contributes $500 per month, at the beginning of each month, to a retirement fund on your behalf. The contributions earn interest at a rate of 6% per year, compounded monthly. At the end of twenty years, what will be the balance of the fund? Group of answer choices $69,790 $232,175 $70,139 $220,713 $231,020
You have just finished your undergraduate degree and you have two career options: Option 1: Accepting a job offer with the starting salary of $75,000 per year (paid at the end of the year) and an annual raise of 2% pa (guaranteed). You will work in this company for 40 years. Option 2: Choosing a graduate program which will cost you $28,000 per year for the next two years (paid at the beginning of each year). Following the graduate school, you can get a job that offers the initial salary of $85,000 (paid at the end of the Year 3) with an annual raise of 3% pa (guaranteed). You will work in this company for 38 years. a. If you use the discount rate of 10% pa, which option is more lucrative for you? b.At what discount rate will you be indifferent between these two career options? (Hint: You need to use the incremental cash flows to answer this question) c. If option 2 (i.e., work after grad school) comes with a signing bonus (paid at the beginning of Year 3), at what signing bonus will…

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