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How much will you need to put into a financial investment

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If you receive $10,000 from your Aunt Lucy and put it in a financial investment that will generate a certain 7% per year (compounded annually), to what sum will this $10,000 grow by the time you retire? (This is called the future value of the amount held today.)

If you want to have $1,000,000 in the bank when you retire, how much will you need to put into a financial investment today, if certain rate of return on your financial investment is 5%? (This is called the present value of the amount to be received in the future.)

Each student has a desired age of retirement for which the student can figure their term of years to use in the calculations. If someone is going to retire the same year and has already posted their answer, decide to retire earlier or later (for the purposes of this discussion) or change the expected rate of return.

Reference no: EM131709419

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