Saving for your retirement by depositing

Assignment Help Financial Management
Reference no: EM131867818

You plan to start saving for your retirement by depositing $9,924 exactly one year from now. Each year you intend to increase your retirement deposit by 3%. You plan on retiring 31 years from now, and you will receive 5% interest compounded annually. This type of cash flow is called a geometric gradient. The formula to calculate the present worth of a geometric gradient is found in Table 3.6 in the textbook. However, in year 12, you have sudden expenses, and you could not deposit any money at the end of year 12. All of your other deposits remain identical to what you would have deposited if you had not skipped a year. In other words, you still deposit $14,574 at the end of year 13. How much money will you have in your retirement account at the end of 31 years?

Reference no: EM131867818

Questions Cloud

What is expected real interest rate : The two-year interest rate is 9% and the expected annual inflation rate is 4.5%. What is the expected real interest rate?
Holiday destination company that sells holiday packages : Escape Vacations Pty Ltd is a Perth holiday destination company that sells holiday packages.
Compare to the peer group and what is causing the trend : Describing how these measures compare to the peer group and what is causing the trend?
Many measures of active management skill : Alpha, as we know it, is actually called Jensen’s alpha, RP – [RF + ßP (RM – RF)], which is one of the many measures of active management skill.
Saving for your retirement by depositing : You plan to start saving for your retirement by depositing $9,924 exactly one year from now.
How much money can you borrow if you can afford payment : How much money can you borrow if you can afford a payment of $800 per month for 30 years at 7% interest?
What is their current yield-what is the capital gains yield : hey have a 10-year maturity, an annual coupon of $50. What is their current yield? (5.88%) What is the capital gains yield?
What will be the firm new market value : Suppose that the firm that’s considering this project has a market value of $2.2 million. What will be the firm’s new market value?
What is the equipment after-tax net salvage value : Allen Air Lines must liquidate some equipment that is being replaced. What is the equipment's after-tax net salvage value?

Reviews

Write a Review

Financial Management Questions & Answers

  Foreign company acquisition

Acquisition by a foreign company and the effects of that decision and the results of foreign exchange in Euro and the exchange rate differences.

  Financial management for profit and non profit organizations

In this essay, we are going to discuss the issues of financial management in a non-profit organisation.

  Method for estimating a venture''s value

Evaluate venture's present value, cash and surplus cash and basic venture capital.

  Replacement analysis

This document show the Replacement Analysis of modling machine. Is replacement give profit to company or not?

  Business finance task - capital budgeting

Your company is considering using the payback period for capital-budgeting. Discuss the advantages and disadvantages of this technique.

  Analysis of the investment

In this project, you will focus on one of these: the additional cost resulting from the purchase of an apple press (a piece of equipment required to manufacture apple juice).

  Conduct a what-if analysis

Review the readings and media for this unit, including the Anthony's Orchard case study media. Familiarise yourself with the Anthony's Orchard company and its current situation.

  Determine operational expenditures

Organisations' behaviour is guided by financial data. In the short term, such data will help determine operational expenditures; in the long term, historical data may help generate forecasts aimed at determining strategic plans. In both instances.

  Personal financial management

How much will you have left over each half year if you adopt the latter course of action?

  Sources of finance for expansion into new foreign markets

A quoted company is considering several long-term sources of finance for expansion into new foreign markets.

  Long term financial planning

This assignment is designed for analyze Long term financial planning begins with the sales forecast and the key input in the long term fincial planning.

  Explain the role of fincial manager

This assignment explain the role of fincial manager, function of manger. And what are the motives of financial manager.

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