Suppose that you'd like to retire in 40 years and you want to have a future value of $ 500000 in a savings account. Also suppose that your employer makes regular monthly payments into your retirement account. If you can expect an APR of 7.5% for your account, how much do you need your employer to deposit each month? Employer Contribution = The formulas we have been using assume that the interest rate is constant over the period in question. Over a period of 40 years, though, interest rates can vary widely. To see what difference the interest rate can make, let's assume a constant APR of 4% for your retirement account. How much do you need your employer to deposit each month under this assumption? Employer Contribution = ccount
Suppose that you'd like to retire in 40 years and you want to have a future value of $ 500000 in a savings account. Also suppose that your employer makes regular monthly payments into your retirement account. If you can expect an APR of 7.5% for your account, how much do you need your employer to deposit each month? Employer Contribution = The formulas we have been using assume that the interest rate is constant over the period in question. Over a period of 40 years, though, interest rates can vary widely. To see what difference the interest rate can make, let's assume a constant APR of 4% for your retirement account. How much do you need your employer to deposit each month under this assumption? Employer Contribution = ccount
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:Suppose that you'd like to retire in 40 years and you want to have a future value of $
500000 in a savings account. Also suppose that your employer makes regular monthly
payments into your
retirement account.
If you can expect an APR of 7.5% for your account, how much do you need your
employer to deposit each month?
Employer Contribution =
The formulas we have been using assume that the interest rate is constant over the
period in question. Over a period of 40 years, though, interest rates can vary widely. To
see what difference the interest rate can make, let's assume a constant APR of 4% for
your retirement account. How much do you need your employer to deposit each month
under this assumption?
Employer Contribution =
rate dic
rest
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