= You want to have $6 million in real dollars in an account when you retire in 40 years. T nominal return on your investment is 14 percent and the inflation rate is percent. What real amount must you deposit each year to achieve your goal? (Do r round intermediate calculations and round your answer to 2 decimal places, e. 32.16.) Deposit amount
= You want to have $6 million in real dollars in an account when you retire in 40 years. T nominal return on your investment is 14 percent and the inflation rate is percent. What real amount must you deposit each year to achieve your goal? (Do r round intermediate calculations and round your answer to 2 decimal places, e. 32.16.) Deposit amount
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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Transcribed Image Text:You want to have $6 million in real dollars in an account when you retire in 40 years. The
nominal return on your investment is 14 percent and the inflation rate is 4.5
percent. What real amount must you deposit each year to achieve your goal? (Do not
round intermediate calculations and round your answer to 2 decimal places, e.g.,
32.16.)
Deposit amount
Transcribed Image Text:Treasury bills are currently paying 6 percent and the inflation rate is 3 percent.
a. What is the approximate real rate of interest? (Enter your answer as a percent
rounded to 2 decimal places, e.g., 32.16.)
b. What is the exact real rate? (Do not round intermediate calculations and enter your
answer as a percent rounded to 2 decimal places, e.g., 32.16.)
a. Approximate real rate
b. Exact real rate
%
%
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