Future value of an annuity

Assignment Help Financial Management

Reference no: EM132010301

FUTURE VALUE OF AN ANNUITY

Your client is 40 years old. She wants to begin saving for retirement, with the first payment to come one year from now. She can save $8,000 per year, and you advise her to invest it in the stock market, which you expect to provide an average return of 6% in the future.

If she follows your advice, how much money will she have at 65? Round your answer to the nearest cent. $

How much will she have at 70? Round your answer to the nearest cent. $

She expects to live for 20 years if she retires at 65 and for 15 years if she retires at 70. If her investments continue to earn the same rate, how much will she be able to withdraw at the end of each year after retirement at each retirement age? Round your answers to the nearest cent.

Annual withdrawals if she retires at 65: $

Annual withdrawals if she retires at 70: $

Reference no: EM132010301

Questions Cloud

Net present value method of capital budgeting : What are the primary strengths and weaknesses of the Net Present Value method of capital budgeting?

Consider important healthcare industries : Consider three important healthcare industries: hospital, medical equipment manufacturers, and biotechnology companies.

What will be your profit from implementing this strategy : Assume you have 1 million USD to conduct one cycle of triangular arbitrage. What will be your profit from implementing this strategy?

Made with covered interest arbitrage : how much profit can be made with covered interest arbitrage, by borrowing 1 million USD?

Future value of an annuity : FUTURE VALUE OF AN ANNUITY. how much will she be able to withdraw at the end of each year after retirement at each retirement age?

Find all nash equilibria for the game : Consider an industry with two firms. Each firm can spend either 0, $1, or $4 on a lobbying effort. Find all Nash equilibria for the game.

What is year four net incremental cash flow : If the relevant tax rate is 40.0%, what is Year 4 net incremental cash flow?

The term capital structure refers : The term "capital structure" refers to:

Macrs schedule for determining depreciation expense : If you use the 7-year MACRS schedule for determining depreciation expense, how much will depreciation be for year 3?

User Account

All Pages