Today is Captains 55th Birthday. He plans to save a fixed amount of money every year starting from his 56th birthday up to and including 65th birthday. Then he will start drawing 10000 a year starting from his 66th birthday up to and including 80th birth day. If the market interest rate is fixed at 10%, how much will he need to save each year? (Rounded to nearest dollar)

Today is Captains 55th Birthday. He plans to save a fixed amount of money every year starting from his 56th birthday up to and including 65th birthday. Then he will start drawing 10000 a year starting from his 66th birthday up to and including 80th birth day. If the market interest rate is fixed at 10%, how much will he need to save each year? (Rounded to nearest dollar)

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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Similar questions

You will retire in 26 years and can afford to put away 11 % of your salary each year. You make payments at the end of each year, including year 26 30. If your salary over the coming year is $118,930 but you expect it to grow at 4 % per year, and you assume a 7% return (annually) on your 401K, how big will your "nest egg" be at retirement? (Round your answer to three decimal places. For example 1.23450 or 1.23463 will be rounded to 1.235 while 1.23448 will be rounded to 1.234. Please DO NOT do any intermediate rounding and only round the final answer
Sam invests $100 each month into his retirement account. He wants to determine how much will accumulate in his retirement account if he invests for the next 10 years if he can get a 6% return. How would he do this? Group of answer choices This is a future value of an annuity with a .5% interest rate and 120 payments This is a future value of $1 with an interest rate of 6% and 10 time periods. This is a future value of $1 with an interest rate of .5% and 120 time periods. This is a future value of an annuity with a 6% interest rate and 10 payments
Can you help me work out this problem in detail? Ben wants to receive $6,000 a year for 10 years. How much must he invest today in an annuity that pays 7% annually?
You plan to retire in 20 years. Use present value tables to calculate whether it is better for you tosave $25,000 a year for the last 10 years before retirement or $15,000 for each of the 20 years.Assume you are able to earn 10 percent interest on your investments. Round to the nearest dollar.
the wood family wants to save money to travel the world. they plan to invest in an ordinary annuity that ears 7.8% interest, compounded monthly. payments will be made at the end of each month.How much money do they need to pay into the annuity each month for the annuity to have a total value of $12,009 after 10 years?
You have 30 years left until retirement and want to retire with $1.5 million. Your salary is paid annually, and will receive $70,000 at the end of the current year. Your salary will increase at 3 percent per year, and you can earn an 10 percent return on the money you invest. If you save a constant percentage of your salary, what percentage of your salary must you save each year?
Sardor has been offered an investment that will pay him $500 three years from today. If his opportunity cost is 7% compounded annually, what value should he place on this opportunity today?
Charlie Munger wants to save for a trip to Italy. He will need $18,108 at the end of 12 years. He can invest a certain amount at the beginning of each of the next 12 years in a bank account that will pay him 5 percent annually. How much will he have to invest annually to reach his target? (Round to the nearest two decimals. Do not type the $ symbol)
Hashim wants to invest an amount of OMR. 9800 every year to buy a house at the end of 10 years. For this purpose, he wants to invest some money in a saving bank but does not know the exact amount of money he will get after 10 years a) What amount will he receive assuming an interest rate of 4.005%? b) What amount will he receive assuming an interest rate of 5.50%? c) Suggest the option which will be enough to meet his house which is estimated to be OMR. 100000?
ohn decides to save some money. He deposits $500 at the end of each year. With an annual interest rate of 10%, what is the future value of his entire savings at the end of the 10th year? (Hint: Use online calculator for an annuity problem)

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