When Joe graduated from college at age 22, his grandparents established a trust fund and endowed it with $10,000. The gift is intended to serve as a retirement fund for Joe, and he will be able to draw on it when he turns 62. If the fund earns a nine percent return over that period, what will it be worth when Joe reaches age 62? [submit your answer with a comma but no dollar signs]

When Joe graduated from college at age 22, his grandparents established a trust fund and endowed it with $10,000. The gift is intended to serve as a retirement fund for Joe, and he will be able to draw on it when he turns 62. If the fund earns a nine percent return over that period, what will it be worth when Joe reaches age 62? [submit your answer with a comma but no dollar signs]

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

Mr. and Mrs. Megabucks would like to set up a college fund for their grandson. They want him to be able to withdraw $1,750 each month for the two years he will be in college. Their grandson is currently celebrating his second birthday. His first college withdrawal will be on his 19th birthday. The college fund will earn j12=2.4%. How much must they deposit today into the college fund? Your Answer: Answer
Larry Mattingly turned 20 years old today. His grandfather had established a trust fund that will pay him $79,000 on his next birthday. However, Larry needs money today to start his college education, and his father is willing to help. Mr. Mattingly has agreed to give Larry the present value of the $79,000 future cash Inflow, assuming a 10 percent rate of return. (PV of $1 and PVA of $1) Note: Use appropriate factor(s) from the tables provided. Required a. Determine the amount of cash that Larry Mattingly's father should give him. Note: Round your final answer to the nearest whole dollar value. Cash
Tom and Sandy have set up a sinking fund in order to have $21,000.00 in 5 years for their child's college education. How much should be paid monthly into an ordinary annuity earning 7.46% compounded monthly so that they reach their goal? How much interest is earned during the last year? (Note: Your answer is a dollar amount and should include a dollar sign)
Donald Trumptobe decided to build his own dynasty. He is considering specifying in his will that at his death, $5,000 would be deposited into a special account that would earn a guaranteed 6% interest compounded daily. This money could not be touched for 100 years, at which point it would be divided among his heirs. Find the future value. (Round your answer to the nearest cent.) $ _______________
William North has just inherited $895,000 which he would like to use as part of his retirement nest egg. He invested the funds at a 6.28 percent annual rate compounded annually. William will reach age sixty in 10 years and will retire early. Now he would like to know how much he could withdraw from the fund in equal installments at the end of each year from the year he reaches age 60 until he reaches age 70¹2, the year he must start withdrawing funds from his individual retirement account (IRA). William assumes the funds will continue to earn at a 6.28 percent annual rate. In other words, William would like to know the annual year-end payment from an eleven-year annuity (from age 60 to the year he will be 70¹2), earning 6.28 percent annually. Round the answer to two decimal places.
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SOLVE TO HAND LEGIBLE; When a father dies, he leaves his children an inheritance of $3,000,000.00. When the father dies, his children are 5,8,9,12 and 15 years old. Each of the children must receive exactly the same amount of money when they turn 18. The money is deposited in a trust that pays 16% annually, convertible every 8 months: How much money will each of the children receive?
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