Need help with this general accounting question Last year, you deposited $25,000 into a retirementsavings account at a fixed rate of 7.5 percent. Today, youcould earn a fixed rate of 8 percent on a similar type ofaccount. However, your rate is fixed and cannot beadjusted. How much less could you have deposited lastyear if you could have earned a fixed rate of 8 percentand still have the same amount as you currently willwhen you retire 40 years from today?

To solve this, we need to calculate the present value difference caused by the change in interest…

Answered: Last year, you deposited $25,000 into a…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Similar questions

You have just made your first $4,300 contribution to your retirement account. Assume you earn a return of 12 percent per year and make no additional contributions. a. What will your account be worth when you retire in 28 years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. What if you wait 10 years before contributing? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
You have just made your first $5686 contribution to your retirement account. Assume you earn a return of 11.5 percent per year and make no additional contributions. What will your account be worth when you retire in 45 years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
You have just made your first $4,000 contribution to your retirement account. Assuming you earn an 9 percent rate of return and make no additional contributions. (A) what will your account be worth when you retire in 25 years? (B) what will your account be worth if you wait 10 years before contributing?
You have just made your first $4,500 contribution to your individual retirement account. Assume you earn an annual return of 10.85 percent and make no additional contributions. a. What will your account be worth when you retire in 43 years? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. b. What if you wait 10 years before contributing? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. a. Account value if you start now b. Account value if you wait 10 years
You have just made your first $4,300 contribution to your retirement account. Assume you earn a return of 12 percent per year and make no additional contributions. What will your account be worth when you retire in 28 years? What if you wait 10 years before contributing?
You have just made your first $5,000 contribution to your retirement account. Assume youearn a return of 10 percent per year and make no additional contributions.a. What will your account be worth when you retire in 45 years?b. What if you wait 10 years before contributing?c. After calculating parts a and b, what is the lesson learned?
You plan to make your first $6,470 contribution to your individual retirement account in 2 years. Assuming you earn a 7.02 percent rate of return and make no additional contributions, what will your account be worth (in $) when you retire 50 years from now?
You plan to retire in 20 years. At the point of retirement, you want to be able to withdraw 25478 at the end of each year forever. Assume that you earn a 7.11% rate of return prior to retirement and an 4.54% rate of return after retirement. If you do not want to make any further contributions to your retirement fund, how much do you need today? Round answer to the nearest dollar.
You have just made your first $5,000 contribution to your retirement account. Assume you earn a return of 10 percent per year and make no additional contributions. What will your account be worth when you retire in 45 years? What if you wait 35 years before contributing? (show answer using function feature in excel)
You have just made your first $10,000 contribution to your individual retirement account. Assume you earn an annual rate of return of 12 percent compounded quarterly and make no additional contributions. What will your account be worth when you retire in 50 years?Note: Do not round intermediate calculations and round your answer to 2 decimal Blaces, e.g., 32.16. You need $20,000 to go on your dream vacation to South Africa. If you save $5,000 today in an account at 10% interest compounded annually, how long will you have to wait to go on your dream vacation?Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.
suppose you put $1500 into your IRA this year. You do not make any additional contributions to the account. If you earn a return of 10.5% annually, how much will you have in the account in 42 years? 932,208 6,615 1,031,590 69,615 99,381
Your employer automatically puts 5 percent of your salary into a 401 (k) retirement account each year. The account earns 7% interest. Suppose you just got the job, your starting salary is $60000, and you expect to receive a 2.5% raise each year. For simplicity, assume that interest earned and your raises are given as nominal rates and compound continuously. Find the value of your retirement account after 25 years Value = $

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