Suppose you have just graduated from college and are deciding on a career. Two career options, along with your expected salary in each of three earning periods, are displayed in the table below. Assume that anycareer will last only three periods before retirement.OccupationPediatricianTeacherPeriod 0 Period 1 Period 24520245Calculate the net present value (NPV) of your lifetime eamings should you choose to pursue a career in pediatrics if your discount factor 8 = 0.7Please round your answer to 1 decimal place

NPV represents the present value of expected future cash inflows and serves as a tool for…

Answered: Suppose you have just graduated from…

Personal Finance

13th Edition

ISBN:9781337669214

Author:GARMAN

Publisher:GARMAN

Chapter13: Investment Fundamentals

Section: Chapter Questions

Problem 3DTM

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Calculate the life insurance gross premium for an insurance company, XYZ Life, under the following assumptions. Please round your answer to the nearest dollar. 1-year term insurance for a 35-year-old female • The death benefit is $10,00O • The probability of death within one year given a female is 35 years old (q30) is 0.015 The interest rate is 1.5% • All deaths occur uniformly, hence for simplicity, price the product assuming all deaths happen at the middle of the year • XYZ Life is looking for a 25% loading based on the pure premium (i.e. PV of expected loss) (Hint: When loading Ap, expressed as a percentage, is based on pure premium, Gross premium = Pure premium × [1 + Ap]) Choose the correct answer from below. $166 $171 $149 $155 O $186
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Subject :- Accounting You have discussed your retirement plans with your significant other and plan to move to a state with a lower cost of living upon retirement. You plan on living off $85,000 annually. You understand that your retirement account will likely yield a 5% return. Using the 4% Rule, how much money do you need in your retirement account upon retirement?(round to the nearest dollar){DO NOT INCLUDE COMMAS OR $}
Using the "Human Life Value" method, how much life insurance should you purchase if you have 45 years until retirement, an annual income of $65,100 received at the start of each years, and a time value of money of 9%? (Assume 80% income replacement, ignore taxes and inflation.)
Norm and Tanya earn about the same salary and are undertaking a life insurance needs analysis for one of them passing away. If the nominal projected investment return is an average of 8% per annum, inflation is projected at 3% per annum, then find the amount of additional insurance they should purchase, given the following data: Number of years insurance money should last 30 Net Worth $33,257 CPP Survivor Benefit $400 per month Salary $45,000 Lifestyle Expenses (after mortgage) will continue at full amount $5,000 per month Additional funds for emergency, vacation & taxes $35,000 Funeral expenses $20,000 Current group insurance coverage from employer 1 x Salary Enter your answer rounded to 2 decimal places, and do not enter any symbols such as $, % or commas.
A consumer’s demand for a medical service is Q=100−PP where PP is the out-of-pocket price she actually faces. She is considering four different insurance options: uninsurance, full insurance, a 50% coinsurance plan, and a copayment plan with a $25 copay. a. Assume this service has a list price of PL =$70. Calculate Q under each insurance plan.b. Calculate the amount of social loss under each insurance plan.c. Derive a general expression for social loss as a function of x and PL, where x is the copay amount under a copayment plan. For simplicity’s sake, assume x<PL.d. Derive a general expression for social loss as a function of y and PL, where y is the coinsurance rate.
1. Assume that you begin saving 3% of your total income in an employer-provided retirement plan at work. How long will it take for you to be saving at least 20% of your income if your employer provides a 4% wage increase yearly and you save half of each year's increase? 2. Based on your calculations from part a. how much will you be saving (using the end-of- year savings rate) over the next 10 years if you earn $30,000 this year?
Suppose you have estimated that you will need $2,500 per month in your retirement to meet your expenses and live comfortably, and that you have found or chosen a fund (account) which pays monthly interest 4% APR . What principal, or balance, will your account need to maintain in order to be able to pay you this amount each month? Round/take your answer to the nearest cent.
4
In this exercise, we consider the effects of starting early or late to save for retirement. Assume that the account considered has an APR of 7.2% compounded monthly. Against expert advice, you begin your retirement program at age 40. You plan to retire at age 60. What monthly contributions do you need to make to reach a nest egg of $137,799.63 at retirement? (round to your nearest cent)
None
Norm and Tanya earn about the same salary and are undertaking a life insurance needs analysis for one of them passing away. If the nominal projected investment return is an average of 8% per annum, inflation is projected at 3% per annum, then find the amount of additional insurance they should purchase, given the following data: Number of years insurance money should last30Net Worth$32,714CPP Survivor Benefit$400 per monthSalary$45,000Lifestyle Expenses (after mortgage) will continue at full amount $5,000 per month Additional funds for emergency, vacation & taxes $35,000 Funeral expenses $20,000 Current group insurance coverage from employer 1 x Salary

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