Solution-Donate a constant amount of money

Donate a constant amount of money

Reference no: EM133118606

You have just turned 30 years old, have just received your MBA, and have accepted your first job. Now you decide to put 10% of your annual salary into your savings account to meet your two objectives after retiring:

First, you would like to be able to retire 30 years from now with a retirement income of $80,000 per year for 30 years, with the first payment coming 31 years from today.
Second, you would like to donate a constant amount of money (use C to denote this constant payment) to the cancer research foundation every year. The donation runs forever and the first payment to the foundation comes also 31 years from today.

Assume that your starting salary is $ 85,000 per year. You will receive your first annual paycheck next year (when you are 31 years old) and it will grow 2% per year until you retire. How much can you donate to the cancer research foundation per year? (solve for C)

Use 7% as annual discount rate.

Reference no: EM133118606

Questions Cloud

How much is the fair value of the net assets of sub company : Parent Corporation acquired 80% of the outstanding voting stock of Sub Company for P4,500,000 on January. How much is the fair value of the net assets

Violent crime control and law enforcement act : Briefly, discuss the effectiveness of consent degrees and Section 14141 of the Violent Crime Control and Law Enforcement Act of 1994.

Homeland security-immigration enforcement play : Considering the current threat landscape, do you feel that poor immigration policy has a nexus with terrorism?

State interest in favoring or disfavoring open adoptions : What is "open" adoption? Are you in favor of it? Why or why not? What is a state's interest in favoring or disfavoring open adoptions

Donate a constant amount of money : You have just turned 30 years old, have just received your MBA, and have accepted your first job. Now you decide to put 10% of your annual salary into your savi

Explain what we mean by information asymmetry : Explain what we mean by information asymmetry (between firm managers and investors), and provide a brief example (real or hypothetical).

Determine the size of the final lease payment : Honda is selling a 2014 Accord Coupe Ex M for $30 056.90 including freight, PDI and all applicable fees. The lease payment of $382 is due at the beginning of ea

Border control offensive : Discuss the actions that prompted the "border control offensive" and made the issue of illegal immigration a priority along the SW border and contrast

Current maritime ashore security and afloat requirements : Based on the current threat, what is the biggest gap in the current maritime ashore security and afloat requirements?

User Account

All Pages

Donate a constant amount of money

Reference no: EM133118606

Reference no: EM133118606

Questions Cloud

Reviews

Write a Review

Finance Basics Questions & Answers

What is the coupon rate

Estimate the number of common shares outstanding

Calculate the accured interest of the bonds

What is the amount of the payments that karla zehms must

Security risk the systematic risk principle states that the

Current share price

Suppose the federal reserve uses data to estimate the

Corporate bond yields and liquidity risk

What will be the company return on equity

Compounded rate of interest was charged in financing

Capital structure analysis

Determining the installment payment plans

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT