Through your career, you have saved-up $1,150,000. You are now ready to retire. You discuss your plans with your bank's financial adviser. He informs you that you can establish an annuity that will pay $68,000 per year for 25 years. What is the implied rate the bank is offering? 3.58% 2.75% 3.26% 3.40%

Q: 6. You have saved $1,000,000, and have thus decided to retire. You have moved all of your money into…

A: PV=$1,000,000 Interest rate=6% Monthly payment can be calculated using the following formula:…

Q: only typing answer with explanation and conclusion To supplement your​ retirement, you estimate that…

A: Future value of deposits grow over the period of time due to compounding of interest and much larger…

Q: 1On the day you retire you have $500,000 saved. You expect to live another 30 years during which…

A: Time value of money refers to the concept that money available today is worth more than the same…

Q: You want to retire exactly 35 years from today with $1,990,000 in your retirement account. If you…

A: Monthly deposits are the amount of money kept aside that earns a defined rate of interest for a…

Q: Suppose you receive $500 in graduation money. You decide to put it into an account paying 5%. If you…

A: FV= [C*{(1+r)^n-1]/r] + [P*(1+r)^n] Where P= Initial deposit = $500 C= Periodic payments = $170 r=…

Q: An individual wants to retire in 25 years and requires $300,000 in savings at that time. The…

A: We need to use RATE function in excel to calculate annual rate of interest on deposit.The formula is…

Q: You have signed up for your 401k and will deposit $750 into your 401k when you are paid at the end…

A: Monthly deposit = p = $750 Interest rate = 6 / 12 = 0.5% Time = t = 15 * 12 = 180 months

Q: You want to retire exactly 35 years from today with $2,080,000 in your retirement account. If you…

A: An annuity refers to a series of equal cash flows received or paid at regular intervals for a…

Q: Your friend offers to pay you an annuity of $2,500 at the end of each year for 3 years in return for…

A: Annual Payment (P) = $2,500Interest rate (r) = 5.5% or 0.055Number of years (n) = 3

Q: You would like to have $600,000 when you retire in 40 years. How much should you invest each quarter…

A: Here, To Find: Part a). Amount of deposit each quarter =? Part b). Total money deposited into the…

Q: ou just paid $350,000 for an annuity that will pay you and your heirs $18,400 a year forever. What…

A: Rate of return on investment depends on the amount of money paid today for annuity and amount you…

Q: You have signed up for your 401k and will deposit $1,200 into your 401k when you are paid at the end…

A: Future value (FV) is the value of an investment or cash flow at a specific point in the future,…

Q: You want to have $100,000 in your savings account 3 years from now, and you're prepared to make…

A:

Q: bjective is to save $500,000 for preparing your retirement, assuming 30 years from now. If you…

A: Future value=$500000Period=n=30 yearsInterest rate=r=10%

Q: re trying to decide how much to say for retirement assume you plan to save 10,000 per year and will…

A: There is need of planning for retirement and if done properly on time can have good retirement life.

Q: Your insurance agent is trying to sell you an annuity that costs $80,000 today. By buying this…

A: Present value is an estimate of the present value of future cash values ​​that may be received at a…

Q: An investment promises to pay into an account that pays you 6 percent  annually, $150 per month for…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: . Example 2 You would like to have $500,000 in your retirement account when you retire in 25 Your…

A: The future value of money is considered as the sum of money received after a period of time at a…

Q: You plan to invest $19,000 per year into a retirement account. If you earn a compound annual rate of…

A: Future value (FV) is the value of an investment or cash flow at a specific point in the future,…

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 deposited $39,000 in a bank account that pays 5.25% WI daily compounding based on a…

A: Future value is the amount initially deposited and amount of comounding interest accumulated over…

Q: Suppose you want to have $500,000 for retirement in 30 years. Your account earns 9% interest. How…

A: Compound = monthly = 12 Future value = fv = $500,000 Time = t = 30 *  12 = 360 months Interest rate…

Q: Solve e

A: When the instalments are at beginning of each period, the annuity if ordinary annuity. Future value…

Q: You want to have $67,000 in your savings account 10 years from now, and you're prepared to make…

A: Payment per period is the regular payments made or received of an investment, while future value is…

Q: You decide to provide yourself with a retirement account by depositing X into an account at the…

A: An immediate annuity is an ordinary annuity where the payments start immediately after being…

Q: You save $800 a year into a 401(k) account that you invest in a mutual fund earning 9% per year.…

A: Given, Amount saved every year is $800 Rate is 9% Number of years is 25.

Q: Baghiben

A: The objective of this question is to calculate the future value of an annuity due. An annuity due is…

Q: You want to have $51,000 in your savings account 9 years from now, and you're prepared to make equal…

A: Payment per period is the regular payments made or received of an investment, while future value is…

Q: Suppose you are 25 years old and would like to retire at age 60. Furthermore, you would like to have…

A: The concept of time value of money will be used and applied here. As per the concept of time value…

Q: You would like to have $700,000 when you retire in 40 years. How much should you invest each quarter…

A: Required future Value "FV" is $700,000 Time period of retirement = 40 years Interest rate is 4%…

Q: Retirement Investment Advisors, Incorporated, has just offered you an annual Interest rate of 4.9…

A: Future value refers to the value of cash flows or annuity at defined future date. It can be…

Q: PART C.) In planning for your retirement, you expect to save $5,000 in year 1, $6,000 in year 2, and…

A: A concept that implies the future worth of the money is lower than its current value due to several…

Q: If you deposit $3,500 monthly into a savings account which earns 4.25% interest rate compounded…

A: The future value function or concept can be used to determine the future value of a present sum or…

Q: •An insurance company offers to pay you $1,000 per year for 10 years if you will pay $6,710 up…

A: We can solve this using Present value of annuity formulaPresent value of annuity is =…

Q: A person wants to establish an annuity for retirement purposes. He wants to make quarterly deposits…

A: Solution:- An equal amount withdrawn is made each period at end of period, is known as ordinary…

Q: Future Value of Multiple Annuities Assume that you contribute $110 per month to a retirement plan…

A: We need to use future value of ordinary annuity formula to calculate value of of your retirement…

Q: Acme Insurance is offering you a perpetuity that will pay you and your heirs $150,000 per year. If…

A: A perpetuity is a type of financial instrument or investment that provides a fixed stream of cash…

Q: You are planning to save for retirement over the next 20 years. To do this, you will invest $900 a…

A: We will apply the TVM (time value of money) concept here.Value or worth of money changes with…

Q: You want to be able to withdraw $45,000 from your account each year for 20 years after you retire.…

A: Yearly deposit refers to an amount that is being deposited each year and earning a specified rate of…

Effective Interest Rate

The term interest rate can be defined as the amount that is charged by the lender as a percentage on the principal amount. Interest rate which is charged annually is known as annual percentage rate.