Suppose you earned a $445,000 bonus this year and invested it at 8.25% per year. How much could you withdraw at the end of each of the next 20 years? Select the correct answer. a. $46,164.70 b. $46,170.70 c. $46,161.70 d. $46,167.70 e. $46,173.70

Suppose you earned a $445,000 bonus this year and invested it at 8.25% per year. How much could you withdraw at the end of each of the next 20 years? Select the correct answer. a. $46,164.70 b. $46,170.70 c. $46,161.70 d. $46,167.70 e. $46,173.70

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter4: Time Value Of Money

Section: Chapter Questions

Problem 9PROB

See similar textbooks

Related questions

Q: You are set to receive $2,190 annually (at the end of each year) forever with returns of 12.40% for…

A: Present value refers to the current date value of the annuity or the series of future cash flows.…

Q: Select the best answer for the question. 20. You want to invest money for three years in an account…

A: The objective of this question is to find out the present value of an investment that will grow to…

Q: If you invest $5,000 three years from now, how much will be in h 15 f if 10% d d ll ? the account 15…

A: Future value: This is the amount of present value accumulated or compounded at a rate of interest…

Q: Assume your goal in life is to retire with four million dollars. How much would you need to save at…

A: The amount needed to save annually can be calculated with the help of future value of annuity

Q: Suppose you earned a $330,000 bonus this year and invested it at 8.25% per year. How much could you…

A: It is a case of calculating the annuity of withdrawals. The withdrawals are done on an annual basis…

Q: 2. An investment promises to pay a perpetuity of $100 per year starting from today. If the discount…

A: A perpetual annuity is a never-ending series of equal cash flows where the investment is done today…

Q: Assume your goal in life is to retire with 2 million dollars. How much would you need to save at the…

A: The amount required to save annually can be calculated with the help of future value of annuity

Q: Suppose you inherited $935,000 and invested it at 8.25% per year. How much could you withdraw at the…

A: Annuity refers to an amount or stream of equal cash flows (CF) paid or received periodically.…

Q: How much would $1. growing at 6.8% per year, be worth after 75 years? Select the correct answer. O a…

A: We need to use future value formula below to calculate worth after 75 years.FV =PV(1+i)nWhereFV…

Q: A new investment opportunity for you is an annuity that pays $1,100 at the beginning of each year…

A: The maximum amount to be paid for annuity can be calculated by discounting future cash inflows at…

Q: Suppose you earned a $295,000 bonus this year and invested it at 8.25% per year. How much could you…

A: Given , P=? Pv=295000 Bonus invested i=intt rate=8.25 % or…

Q: A new investment opportunity for you is an annuity that pays $650 at the beginning of each year for…

A: An annuity is a financial product that provides a series of regular payments to an individual over a…

Q: Assume you invest $1 000 at the end of this year, at the end of the second year, and at the end of…

A: Annual deposit for 3 years = $ 1000 Annual interest rate = 5% Future value period = 4 Years

Q: What rate of return would you need if you wanted to accumulate $1,000,000 in 25 years and invest…

A: Rate of return: It implies to the rate that is often expected or charged by the investor from the…

Q: If you invest $4,000 at the end of every year for nine years at an interest rate of 6%, the balance…

A: Future value in case of continues payments = Each installment × (1+pir) ^n/pir Where pir =…

Q: You want to have $3.5 million in real dollars in an account when you retire in 50 years. The nominal…

A: The formula used to compute real rate of return as follows: Real rate of return=1+Nominal…

Q: What amount must you invest today at 6% compounded annually so that you can withdraw $5,000 at the…

A: Present Value is the current value of the future sum of money at the specific rate of return.

Q: Your friend offers you an investment opportunity that would yield $100 per year for the next 3…

A: Solution:- Present value means the value of cash flows from the project in today’s terms i.e.…

Q: Suppose you inherited $175,000 and invested it at 8.55% per year. How much could you withdraw at the…

A: Annual withdrawal (Annuity) = Investment / PVA of $1

Q: Suppose you inherited $1,135,000 and invested it at 8.25% per year. How much could you withdraw at…

A: The objective of the question is to find out the amount that can be withdrawn at the beginning of…

Q: You’ve invested your savings at 8% and been able to accumulate $500,000. If you withdraw $50,000 at…

A: The question is based on the concept of Financial Accounting.

Q: How much would $1, growing at 13.7% per year, be worth after 75 years? Select one: a. $18,248.03…

A: Present value (PV) = $1 Interest rate (r) = 13.7% Period (n) = 75

Q: You want to retire with $400 000 in the bank and you are able to earn 6% compounded quarterly for…

A: The amount to be invested today is calculated using present value equation below Present value =…

Q: You plan to invest $5,000 into an account. If you would like to have $10,000 in 15 years, what…

A: Solution: When an amount is deposited somewhere, it earns interest on it. The amount initially…

Q: A perpetuity of $5,000 per year beginning today, offers a 10% retur A. $33,333.33 B. $55,000.00 O C.…

A: Perpetuity is the payment forever and today value is the equivalent deposit required today that will…

Q: Suppose you inherited $1,425,000 and invested it at 7.80% per year. How much could you withdraw at…

A: The objective of the question is to find out the amount that can be withdrawn at the beginning of…

Q: Suppose you inherited $275,000 and invested it at 8.25% per year. How much could you withdraw at the…

A: To calculate how much you could withdraw at the beginning of each of the next 20 years from an…

Question

Suppose you earned a $445,000 bonus this year and invested it at 8.25% per year. How much could you withdraw at the end of each of the next 20 years?

Select the correct answer.

a. $46,164.70

b. $46,170.70

c. $46,161.70

d. $46,167.70

e. $46,173.70

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

Step 2

Step 3

Step 4

Trending now

This is a popular solution!

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

How much would you invest today in order to receive $30,000 in each of the following (for further Instructions on present value In Excel, see Appendix C): A. 10 years at 9% B. 8 years at 12% C. 14 years at 15% D. 19 years at 18%
How much would you invest today in order to receive $30,000 in each of the following (for further instructions on present value in Excel, see Appendix C): A. 20 years at 22% B. 12 years at 10% C. 5 years at 14% D. 2 years at 7%
Suppose you earned a $273,000 bonus this year and invested it at 8.20% per year. How much could you withdraw at the end of each of the next 20 years? Group of answer choices $29,648 $32,703 $31,146 $34,370 $28,221
What rate of return would you need if you wanted to accumulate $1,000,000 in 25 years and invest $10,000 per year? O A. 10.11% B. 9% O C. 34.7% O D. 8.4% ......
Assume your goal in life is to retire with 2 million dollars. How much would you need to save at the end of each year if investment rates average 6% and you have a 19-year work life? a.$661,026. b.$6,316. c.$59,242. d.$210,526.
Assume your goal in life is to retire with $3,200,000.How much would you need to save at the end of each year if interest rates average 4%and you have a 30−year work life? (Round the final answer to the nearest whole dollar.) A. $213,333 B. $4,267 C. $986,620 D. $57,056
A new investment opportunity for you is an annuity that pays $1,100 at the beginning of each year for 3 years. You could earn 5.5% on your money in other investments with equal risk. What is the most you should pay for the annuity? Select the correct answer. a. $3,141.25 b. $3,130.95 c. $3,120.65 d. $3,110.35 e. $3,100.05
2. An investment promises to pay a perpetuity of $100 per year starting from today. If the discount rate is 10% per year, how much should you pay for this investment? A $90.9091 B $190.9091 C $1,000 D $1,100
Select the best answer for the question. 20. You want to invest money for three years in an account that pays nine-percent interest annually. How much would you need to invest today to reach a future goal of $12,000? (Round your answer to the nearest dollar.) A. $10,984 OB. $10,100 OC. $11,432 OD. $9,266
How much do you need to invest today if you will also invest $2,700 at the end of every year for 39 years, in order to have $1,000,000 at the end of 39 years? Assume your investments earn a rate of return of 6.5% compounded annually. O $23,166 O $76,744 O $10,257 $49,207 O $47,800
15
How much will you pay for an investment if you expect to receive $7.000 end of each years for 5 years and if the appropriate interest rate is 4.5%? $27,831.47 $29,851.84 O $29,083.89 O $30,729.84 $38,294.97 O $8,723.27