One year after the last full withdrawal will exhaust fund

Assignment Help Financial Management
Reference no: EM131898738

On his 25th birthday, Yves deposited $4000 in a fund paying 5%/year compounded annually and continued to make such deposits each year, the last of which on his 49th birthday. Beginning on his 50th birthday, Yves plans to make equal annual withdrawals of $20 000.

a) How many such withdrawals can be made?

b) What additional sum paid with the last withdrawal will exhaust the fund?

c) What sum paid one year after the last full withdrawal will exhaust the fund?

Reference no: EM131898738

Questions Cloud

Share of corporation using discounted free cash flow : You want to estimate the value per share of a corporation using a discounted Free Cash Flow (FCF) approach and the following data:
What will be the balance in the account at the end of years : The first payment is made one quarter from now. What will be the balance in the account at the end of 18 years?
What is the real return on long-term government bonds : What is the real return on long-term government bonds?
Stock according to constant growth stock valuation model : what is the most you should pay for the stock according to the constant growth stock valuation model.
One year after the last full withdrawal will exhaust fund : How many such withdrawals can be made? What sum paid one year after the last full withdrawal will exhaust the fund?
What should be the price of the company stock : what should be the price of the company's stock today (December 31, 2013)?
Calculate the ratios for current ratio and acid test ratio : Financial Data for Springfield Power Co. as of December 31, 2004. calculate the follwoing ratios for the Springfield Power Co. Current ratio. Acid test ratio.
Depth detail on personal financial planning : Morningstar.com is a useful personal and business investment site with in-depth detail on personal financial planning.
Disadvantages of relative valuation methods : Discuss the advantages/disadvantages of relative valuation methods

Reviews

Write a Review

Financial Management Questions & Answers

  Find the discounted payback period of the project

You have been asked by your boss to evaluate the acquisition of the production equipment for the purpose, after a 1-year research that cost the company $800,000. The acquisition base price of the equipment is $1.7 million and it would cost another $3..

  Investment in subsidiary under the cost method

On January 1, 20X1, Parent Company purchased 80% of the common stock of Subsidiary Company for $316,000. On this date, Subsidiary had common stock, other paid-in capital, and retained earnings of $40,000, $120,000, and $190,000, respectively. Any rem..

  Calculate the current return on a stock

Calculate the current return on a stock of your choice and compare it to returns on bonds. Which is better to invest in presently a stock or a bond in this company and why? Please explain

  Superior forecasting results from this method in future

Assume there is a regression model that was able to identify the factors that affected exchange rate movements in a recent four year period. Also, suppose that the sensitivity of the exchange rate’s movements to each factor was precisely quantified. ..

  Assuming that stock market is efficient-receive full credit

Assuming that the stock market is efficient, is each of the following statements true or false (to receive full credit, you must explain why in two or three sentences or with an example)? The stock price of Company X doubled over the past year, the s..

  Finance plant expansion

DiPitro’s Paint and Wallpaper, Inc., needs to raise $1.06 million to finance plant expansion.

  How is relevant costing used in decision making

How is relevant costing used in decision making? What would the relevant costs be in deciding whether to discontinue a segment of business? What would the relevant costs be in deciding how to optimize use of a constrained resource?

  What must the beta of this stock be

A stock has an expected return of 12.2 percent, the risk-free rate is 6 percent, and the market risk premium is 10 percent. What must the beta of this stock be?

  Determine whether a long or short hedge is appropriate

Determine whether a long or short hedge is appropriate. -  A firm anticipates issuing stock in three months.- An investor plans to buy a bond in 30 days.

  IPO dilemma and the Dividend Yield Problem

Role of IMFs How have international mutual funds (IMFs) increased the international integration of capital markets among countries?

  Important source of funds to small to medium sized firms

What is the most important source of funds to small- to medium-sized firms? What is the most important source of external funds to small- to medium-sized firms?

  Traditional pension plan

A recent college graduate has taken a new job at Work LLC, and since the company does not offer a traditional pension plan,

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