Accumulate the necessary funds

Assignment Help Finance Basics
Reference no: EM13669025

Currently 30 years of age. You intend to retire at age 60 and you want to be able to receive a 20-year, $100,000 beginning-of-year annuity with the first payment to be received on your 60th birthday. You would like to save enough money over the next 15 years to achieve your objective; that is, you want to accumulate the necessary funds by your 45th birthday.
a. If you expect your investments to earn 12 percent per year over the next 15 years and 10 percent per year thereafter, how much must you accumulate by the time you reach age 45?
b. What equal, annual amount must you save at the end of each of the next 15 years to achieve your objective, assuming that you currently have $10,000 available to meet your goal? Assume the conditions stated in Part a.

Reference no: EM13669025

Questions Cloud

Prepare the c (regular) corporation tax return : Prepare the C (Regular) Corporation Tax Return for the Lawson And Norman Enterprises, Inc. for the tax year of 2013.
Contribute no additional savings : You are saving money for a down payment on a house. Suppose you want to have total savings of $20,000 in 10 years time and you have currently $5,000. What annual interest rate do you need to earn on your initial investment, assuming you contrib..
The after-tax incremental cash flow : The after-tax incremental cash flow
What is your realized compound yield on the bond : What is your realized compound yield on the bond?
Accumulate the necessary funds : Currently 30 years of age. You intend to retire at age 60 and you want to be able to receive a 20-year, $100,000 beginning-of-year annuity with the first payment to be received on your 60th birthday. You would like to save enough money over th..
The class is theory and monetary policy : The class is theory and monetary policy
Budget analysis : Budget Analysis
How many polo shirts can zane purchase today : How many polo shirts can Zane purchase today?
How can you get a free lunch from the market : 1- A stock sells for $52 per share, and the 6-month European call on the stock with a strike price of $50 sells for $2.50. The stock is not expected to pay any dividends in next six months. The risk free interest rate is 4% per annum, continuo..

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd