Largest accumulation of money

Reference no: EM131011063

You are one of the retirement counselors at the Valley View Bank. You have been asked to give a presentation to a class of high school seniors about the importance of saving for retirement. Your boss, the vice president of the trust division, has designed an example for you to use in your presentation. The students are shown five retirement scenarios and are asked to guess which yields the most money. Note annuities are ordinary. Although some people stop investing, the money remains in the account at 10% interest compounded annually.

A. Look at each scenario and make an educated guess as to which investor will have the Largest accumulation of money invested at 10% over the next 40 years. Then for your Presentation, calculate the final value for each scenario.

Venus invests $1,200 per year and stops after 15 years.
Kevin waits 15 years, invests $1,200 per year for 15 years, and stops.
Rafael waits 15 years, and then invests $1,200 per year for 25 years.
Magda waits 10 years, invests $1,500 per year for 15 years, and stops.
Heather waits 10 years, and then invests $1,500 per year for 30 years.

B. Based on the results, what message will this presentation convey to the students?

C. Recalculate each scenario as an annuity due.

D. How can the results be used in your presentation

Show all work.

Reference no: EM131011063

Questions Cloud

What are the different types of networks : What are the principal components of telecommunications networks and key networking technologies? Describe the features of a simple network and the network infrastructure for a large company.

Questions on exchange rate pass-through : Assume that the export price of a Toyota Corolla from Osaka, Japan is ¥2,150,000. The exchange rate is ¥87.60/$. The forecast rate of inflation in the United States is 2.2% per year and in Japan is 0.0% per year. Use this data to answer the follow..

Actual present value of offer : You are the owner of an apartment building that is being offered for sale for $1,500,000. You receive an offer from a prospective buyer who wants to pay you $500,000 now, $500,000 in 6 months, and $500,000 in 1 year. a. What is the actual present ..

Discuss supply chain and distribution channels : Discuss supply chain and distribution channels. You may include one or two small graphics to further explain your position. In your paper explain how you would set up your supply chain and the distribution channel of your product.

Largest accumulation of money : Look at each scenario and make an educated guess as to which investor will have the Largest accumulation of money invested at 10% over the next 40 years. Then for your Presentation, calculate the final value for each scenario.

Write research paper about autism : A research paper about Autism

Calculate some financial ratios : The project will be completed in five parts. In each part your will answer specific questions and calculate some financial ratios. Remember, financial ratios can be calculated different ways and publicly available financial statements are not alwa..

Differentiate between the populations : Differentiate between the populations for which the Beck Depression Inventory psychological measure is valid and invalid

Find a vector perpendicular to the tangent plane : Consider the function g(x,y,z)= x2 + y2 + z2. Describe the level set g = 16. Find a vector perpendicular to the tangent plane to the level set g = 16 at the point (1, 2, 1).

User Account

All Pages