You wish to retire in 11 years, at which time you want to have accumulated enough money to receive an annual annulty of $26,000 for16 years after retirement. During the period before retirement you can earn 12 percent annually, while after retirement you can earn 14percent on your money.What annual contributions to the retirement fund will allow you to receive the $26,000 annuity? Use Appendix C and Appendix D foran approximate answer, but calculate your final answer using the formula and financial calculator methods.Note: Do not round Intermediate calculations. Round your final answer to 2 decimal places.Annual contribution

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Answered: You wish to retire in 11 years, at…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 19P

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You would like to have enough money saved to receive a $90,000 per year perpetuity after retirement. The annual interest rate is 8 percent. Required: How much would you need to have saved in your retirement fund to achieve this goal? a) Assume that the perpetuity payments start on the day of your retirement. b) Assume that the perpetuity payments start one year from the date of your retirement.
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Del Monty will receive the following payments at the end of the next three years: $20,000, $23,000, and $25,00O. Then from the end of the 4th year through the end of the 10th year, he will receive an annuity of $26,000 per year. At a discount rate of 10 percent, what is the present value of all three future benefits? Use Appendix B and Appendix D for an approximate answer, but calculate your final answer using the formula and financial calculator methods. (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Present value of all future benefits
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