Suppose that you are 25 years old and you plan to begin contributing to a retirement fund earning interest at a rate of 4.5% per year compounded monthly. Your plan is to retire at the age of 65, and you would like to be able to withdraw $8,000 per month from your retirement for 25 years after retirement. How much must you contribute each month for the next 40 years to meet your retirement goal? Solve using the appropriate formula(s): write the formula(s) that is/are needed, fill in the formula(s) with the corresponding numbers, and solve. Round the final answer to two decimal places and include units.
Suppose that you are 25 years old and you plan to begin contributing to a retirement fund earning interest at a rate of 4.5% per year compounded monthly. Your plan is to retire at the age of 65, and you would like to be able to withdraw $8,000 per month from your retirement for 25 years after retirement. How much must you contribute each month for the next 40 years to meet your retirement goal? Solve using the appropriate formula(s): write the formula(s) that is/are needed, fill in the formula(s) with the corresponding numbers, and solve. Round the final answer to two decimal places and include units.
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:2. Suppose that you are 25 years old and you plan to begin contributing to a retirement fund
earning interest at a rate of 4.5% per year compounded monthly. Your plan is to retire at the
age of 65, and you would like to be able to withdraw $8,000 per month from your retirement
for 25 years after retirement. How much must you contribute each month for the next 40
years to meet your retirement goal?
Solve using the appropriate formula(s): write the formula(s) that is/are needed, fill in the
formula(s) with the corresponding numbers, and solve. Round the final answer to two decimal
places and include units.
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