(Related to Checkpoint 5.4) (Present value) Sarah Wiggum would like to make a single investment and have $2.3 million at the time of her retirement in 34 years. She has found a mutual fund that will earn 7 percent annually. How much will Sarah have to invest today? If Sarah earned an annual return of 15 percent, how soon could she then retire?
(Related to Checkpoint 5.4) (Present value) Sarah Wiggum would like to make a single investment and have $2.3 million at the time of her retirement in 34 years. She has found a mutual fund that will earn 7 percent annually. How much will Sarah have to invest today? If Sarah earned an annual return of 15 percent, how soon could she then retire?
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:(Related to Checkpoint 5.4) (Present value) Sarah Wiggum would like to make a single investment and have $2.3 million at the time of her retirement in 34 years. She has found a mutual fund that will earn 7 percent annually. How much will Sarah have to invest today? If Sarah earned an annual
return of 15 percent, how soon could she then retire?
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