Q.5 Your new job offers a savings plan that pays 1.00 percent in interest each month. You can't participate in the plan, however, until youhave 9 years with the company. At that time you will start saving $800 a month for the next 22 years.How much will you have in this savings account in 31 years? Round your answer to twodecimalsAnother perk of your new job is that, after 9 years with the company, you will also get an increase of $125 in your monthly salary.Assume you would stay with the company for 22 more years after getting the salary increase, and that you discount at 1.00percent each month.What is this salary increase worth to you today? Round your answer to two decimals.

1. Rate per month(r) =1%Number of Periods for 20 years(n) =22 x 12 = 264Savings per month (PMT) =…

Answered: Your new job offers a savings plan that…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 35P

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