You are saving for retirement. To live comfortably, you decide you will need to save $1,400,000 by the time you are 67. Today is your 20th birthday, and you decide, starting today and continuing on every birthday up to and including your 67th birthday, that you will put the same amount into a savings account. If the interest rate is 12%, how much must you set aside each year to make sure that you will have $1,400,000 in the account on your 67th birthday? The amount to deposit each year is $ (Round to the nearest cent.)
You are saving for retirement. To live comfortably, you decide you will need to save $1,400,000 by the time you are 67. Today is your 20th birthday, and you decide, starting today and continuing on every birthday up to and including your 67th birthday, that you will put the same amount into a savings account. If the interest rate is 12%, how much must you set aside each year to make sure that you will have $1,400,000 in the account on your 67th birthday? The amount to deposit each year is $ (Round to the nearest cent.)
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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![**Retirement Savings Plan**
You are saving for retirement. To live comfortably, you decide you will need to save $1,400,000 by the time you are 67. Today is your 20th birthday, and you decide, starting today and continuing on every birthday up to and including your 67th birthday, that you will put the same amount into a savings account. If the interest rate is 12%, how much must you set aside each year to make sure that you will have $1,400,000 in the account on your 67th birthday?
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**Calculation:**
The amount to deposit each year is $[ ]. (Round to the nearest cent.)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6d8b207e-b50e-40e7-b072-7e1033b72f37%2F1a6808db-2acd-4df2-abf8-a84612a05513%2Fqnazor_processed.png&w=3840&q=75)
Transcribed Image Text:**Retirement Savings Plan**
You are saving for retirement. To live comfortably, you decide you will need to save $1,400,000 by the time you are 67. Today is your 20th birthday, and you decide, starting today and continuing on every birthday up to and including your 67th birthday, that you will put the same amount into a savings account. If the interest rate is 12%, how much must you set aside each year to make sure that you will have $1,400,000 in the account on your 67th birthday?
---
**Calculation:**
The amount to deposit each year is $[ ]. (Round to the nearest cent.)
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