Sarah Wiggum would like to make a single investment and have ​$2.0 million at the time of her retirement in 35 years. She has found a mutual fund that will earn 4 percent annually. How much will Sarah have to invest​ today? If Sarah earned an annual return of 14 ​percent, how soon could she then​ retire?   a.  If Sarah can earn 4 percent annually for the next 35 ​years, the amount of money she will have to invest today is

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
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​(Related to Checkpoint​ 5.4) ​ (Present value)  Sarah Wiggum would like to make a single investment and have
​$2.0
million at the time of her retirement in
35
years. She has found a mutual fund that will earn
4
percent annually. How much will Sarah have to invest​ today? If Sarah earned an annual return of
14
​percent, how soon could she then​ retire?  
a.  If Sarah can earn
4
percent annually for the next
35
​years, the amount of money she will have to invest today is
​$nothing.
​(Round to the nearest​ cent.)
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