Mia plans to save for retirement starting at the age of 35 (year O). She will make a payment at the beginning of each year until age 64. Starting from age 65, she will withdraw 100,000 USD every year for 20 years until her age of 84. Her account balance will reach to $0 at the beginning of her age 85. The retirement plan Mia is looking at provides a interest rate of 10% annually. What would be the fair annual payment for 30 years of this retirement plan? O $5175.61 O $4275.33 $5293 $53669

Mia plans to save for retirement starting at the age of 35 (year O). She will make a payment at the beginning of each year until age 64. Starting from age 65, she will withdraw 100,000 USD every year for 20 years until her age of 84. Her account balance will reach to $0 at the beginning of her age 85. The retirement plan Mia is looking at provides a interest rate of 10% annually. What would be the fair annual payment for 30 years of this retirement plan? O $5175.61 O $4275.33 $5293 $53669

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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Frank plans to set aside money for his young daughter's college tuition. He will deposit money in an ordinary annuity that earns 7.2% interest, compounded quarterly. Deposits will be made at the end of each quarter. How much money does he need to deposit into the annuity each quarter for the annuity to have a total value of $71,000 after 16 years?
The Martinez are planning for a retirement home. They estimate they will need $212,000 4 years from now to purchase this home. Assuming an interest rate of 12%, with four equal amounts being deposited at the beginning of the period. What amount must be deposited at the beginning of each period?
Kate is 28 years old today and is beginning to plan for her retirement . She wants to set aside an equalamount at the end of each of the next 37 years so that she can retire at age 65 . She expects to live to the maximum ageof 90 and wants to be able to withdraw $250,000 per year for 25 years from the account on her 66th through 90th birthday. The account is expected to earn 5% annually. Determine the size of the annual deposit by kate
Isabelle wants to save for retirement. She earns $5400 in income each month, and wishes to deposit 10% of her income into a savings acount each month. If the savings account has a nominal interest rate of 7%, compounded monthly, how much will be in the account if she retires in 35 years?
Adele is planning for retirement. She would like to have $75,000 in her hand at the beginning of her first year of retirement at age 65 to live on for the year. She estimates that the amount will have to grow by 6% every year to keep up with inflation. What APR (nominal rate per year) should her retirement account earn if it is compounded continuously? She plans to deposit $21,000 on her 40th birthday and plans to keep increasing the deposits by 6% every year and till her 64th birthday. She estimates her life expectancy to be 85, meaning she would like to have the last retirement payment on her 85th birthday.
Please explain and solve with detailed workings
Sehar has accumulated $245,000 in her retirement savings plan. When she retires in exactly 4 years from today, she will purchase an annuity that will provide end-of-month payments for 20 years. If her funds earn 6% compounded quarterly during both the period of deferral and the annuity period, how much will her Sehar’s monthly payments be during retirement?
Sally has decided to invest $70 at the end of each mouth into a retirement plan that has an annual rate of 5.6%, compounded monthly. If Sally continues her investments for a period of 9 years, how much money will she have in the plan?
A woman is planning for retirement in 30 years and decides she can deposit $6,000 each year on December 31 into a retirement savings plan that she expects will pay 6% interest. In 20 years she also expects to receive a small inheritance of $12,000 that she can also put into her retirement fund. The woman anticipates that her retirement fund will need to last 20 years; she estimates that she will need $60,000 at the end of each year in retirement to cover her living expenses. Her plan is flawed. How much extra does she need to save every year (rounded to dollars and cents) to achieve her goals? (Do not round interim calculations)
Adele is planning for retirement. She would like to have $75,000 in her hand at the beginning of her first year of retirement at age 65 to live on for the year. She estimates that the amount will have to grow by 6% every year to keep up with inflation. What APR (nominal rate per year) should her retirement account earn if it is compounded continuously? She plans to deposit $21,000 on her 40th birthday and plans to keep increasing the deposits by 6% every year and till her 64th birthday. She estimates her life expectancy to be 85, meaning she would like to have the last retirement payment on her 85th birthday.
To help out with her retirement savings, Linda invests in an ordinary annuity that earns 6.6% interest, compounded annually. Payments will be made at the end of each year. Continue How much money does she need to pay into the annuity each year for the annuity to have a total value of $97,000 after 17 years? Do not round intermediate computations, and round your final answer to the nearest cent. If necessary, refer to the list of financial formulas. 50°F Mostly cloudy Es O 2 2 W 0 3 E 4 X R O S F6 % 5 € T Y F8 & 7 a 7 U 27 D * 00 Submit Assignmen 2022 McGraw Hill LLC. All Rights Reserved. Terms of Use | Privacy Center | Accessibility F10 D X I 9 2 F11 PDF F12 NumLk Prt Sc ^ Pause Br +
Shelly Franks is planning for her retirement, so she is setting up a payout annuity with her bank. She is now 25 years old, and she will retire when she is 65. She wants to receive annual payouts for twenty years, and she wants those payouts to receive an annual COLA of 2.8%. (a) She wants her first payout to have the same purchasing power as does $14000 today. How big should that payout be if she assumes inflation of 2.8% per year? (b) How much money must she deposit when she is 65 if her money earns 8.1% interest per year? (c) How large a monthly payment must she make if she saves for her payout annuity with an ordinary annuity? (The two annuities pay the same interest rate.) (d) How large a monthly payment would she make if she waits until she is 30 before starting her ordinary annuity?

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