Vernon has nothing saved for retirement. He wants to receive $46,000 per year for 5 years during retirement. The first of these payments will be received in 5years. Vernon can earn a return of 15.30 percent per year. How much does Vernon need to save each year for 5 years to have exactly enough to meet hisretirement goal if he makes his first annual savings contribution in 1 year and all savings contributions are equal?$19,578.62 (plus or minus 10 dollars)$26,027.99 (plus or minus 10 dollars)$22,574.14 (plus or minus 10 dollars)$20,014.80 (plus or minus 10 dollars)none of the answers are within 10 dollars of the correct answer

Answered: Image /qna-images/answer/14829cc2-c7b4-4ae1-9c49-8edc9fbb2ef4.jpg

Answered: Vernon has nothing saved for…

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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Today, Jeff has $350,000 in his savings and Patrick has $875,000. Patrick will not make any more deposits over the next 10 years, but he will earn 7% per year on his current savings. Jeff plans to deposit $8,000 per year into his savings for the next 10 years. He also wants to seek out a higher return for his savings so that he will have the same amount of money as Patrick will 10 years from now. What rate of return will Jeff have to earn over the next 10 years in order to catch up with Patrick? 16.05% 22.09% 19.22% O 17.44%
Jane wants to retire with $2,000,000 in her retirement account exactly 35 years from today. If she thinks she can earn an interest rate of 10. percent compounded monthly, how much must she deposit each month to fund her retirement? $432.83 O $493,32 O $526.78 $582.32
2. a. Jake is 10 years from retirement. He has decided that in order to be comfortable and be able to travel, he needs to have an income of $8000 per month. How much does he need ta have in his retirement that earns 8% per year compounded monthly, in order to withdraw S8000 per month for 30 years?
bed What's the interest rate of a 5-year, annual $5,400 annuity with present value of $22,000? (Use a time value of money calculator or a spreadsheet. Round your answer to 2 decimal places.) Annuity interest rate %
Your parents will retire in 22 years. They currently have $220,000 saved, and they think they will need $2,300,000 at retirement. What annual interest rate must they earn to reach their goal, assuming they don't save any additional funds? Round your answer to two decimal places.
Your parents will retire in 17 years. They currently have $290,000 saved, and they think they will need $2,000,000 at retirement. What annual interest rate must they earn to reach their goal, assuming they don't save any additional funds? Round your answer to two decimal places.
Your great-uncle Claude is 82 years old. Over the years, he has accumulated savings of $180,000. He estimates that he will live another 18 years at the most and wants to spend his savings by then. (If he lives longer than that, he figures you will be happy to take care of him.) Uncle Claude places his $180,000 into an account earning 9 percent annually and sets it up in such a way that he will be making 18 equal annual withdrawals—the first one occurring one year from now—such that his account balance will be zero at the end of 18 years. How much will he be able to withdraw each year?
am. 41.
Mr. Mangano is considering taking early retirement, having saved $400,000. Mr. Mangano wishes to determine how many years the saving will last if he withdraws $60,000 per year at the end of each year. Mr.Mangano's savings can earn 10 percent per year. 11.67 years. 11.35 years 10.90 years 11.53 years. 12.01 years
Marc has nothing saved for retirement. He wants to receive $46,000.00 per year for 5 years during retirement. The first of these payments will be received in 7 years. Marc can earn a return of 9.38 percent per year. How much does Marc need to save each year for 6 years to have exactly enough to meet his retirement goal if he makes his first annual savings contribution in 1 year and all savings contributions are equal? O $21,324.88 (plus or minus 10 dollars) O $25,513.05 (plus or minus 10 dollars) O $23,325.15 (plus or minus 10 dollars) O $20,819.31 (plus or minus 10 dollars) O none of the answers are within 10 dollars of the correct answer
Your great-uncle Claude is 82 years old. Over the years, he has accumulated savings of $80,000. He estimates that he will live another 10 years at the most and wants to spend his savings by then. (If he lives longer than that, he figures you will be happy to take care of him) Uncle Claude places his $80,000 into an account earning10 percent annually and sets it up in such a way that he will be making 10 equal annual withdrawals-the first one occurring one year from now- such that his account balance will be zero at the end of 10 years. How much will he be able to with draweach year?
Two people plan to invest $50,000. Matt is going to invest it in one lump sum and leave it in the account for 25 years to use for retirement. Sarah is going to invest $2000 per year for 25 years and will also use the money in the account for retirement. Is it reasonable to expect that Matt will have more money in his account than Sarah does in 25 years if both accounts earn the same interest?

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