What is the value of this account when they retire

Assignment Help Financial Management
Reference no: EM132014397

A couple saves $500.00 per month (end of month) for 40.00 years. They can earn 6.00% annual interest with monthly compounding on this account. The couple wants their retirement account to last for 25.00 years. When they retire, they will move their savings into a money market fund that pays 2.40% annual interest with monthly compounding. What is the value of this account when they retire? Answer Format: Currency: Round to: 2 decimal places.

Reference no: EM132014397

Questions Cloud

Synergy is created in an acquisition : Shareholders value firms based on their. Synergy is created in an acquisition only if the.
What monthly withdrawals will this account support : Assuming they withdraw at the beginning of the month, what monthly withdrawals will this account support?
What is the stock value per share : If Smith has 65 million shares of stock outstanding, what is the stock's value per share?
What is the firm horizon or continuing and value : What is the firm's horizon, or continuing, value? What is the firm's intrinsic value today, P0?
What is the value of this account when they retire : What is the value of this account when they retire?
The cash cycle includes the time period between the time : The cash cycle includes the time period between the time when
Irr rule advise regarding payment arrangement : What does the IRR rule advise regarding the payment arrangement?
What size loan will the bank offer the couple : What size loan will the bank offer the couple with these requirements?
How much would the investor have to set aside today : How much would the investor have to set aside today if she wants to fund the entire account?

Reviews

Write a Review

Financial Management Questions & Answers

  Calculate the weighted average cost of capital for company

The company has 2,000,000 shares outstanding with acurrent stock price of $22 per share. Calculate the weighted average cost of capital for the company.

  Annual dividend-what is its current value

A firm recently paid a $0.80 annual dividend. If the required return for this stock is 16.50 percent, what is its current value?

  Which of these two bonds should the investor select

An investor in the 28% tax bracket is trying to decide which of two bonds to select: one is a 5.5% U.S. Treasury bond selling at par; the other is a municipal bond with a 4.2% coupon, which is also selling at par. Which of these two bonds should the ..

  Constant-growth model-what price should the stock sell

Constant-Growth Model. Gentleman Gym just paid its annual dividend of $3 per share, and it is widely expected that the dividend will increase by 5% per year indefinitely. what price should the stock sell at? The discount rate is 15%. How would your a..

  Expected return-standard deviation of variance portfolio

Consider two stocks, Stock D, with an expected return of 16 percent and a standard deviation of 31 percent, and Stock I, an international company, with an expected return of 9 percent and a standard deviation of 19 percent. What are the expected retu..

  What is percentage change in the bonds price

A 9-year bond has a yield of 8.5% and a duration of 8.489 years. If the market yield changes by 90 basis points, what is the percentage change in bond's price.

  Handle project valuation-current stock price per share

Dave Inc. recently hired you as a consultant to handle project valuation. What is Dave’s current stock price per share?

  Calculate the initial outlay and annual operating cash flow

Calculate the initial outlay, annual operating cash flow and terminal cash flows. Complete the table with the timeline and calculate NPV and IRR of the project.

  A portfolio constructed of which pairs of stocks will have

Given these correlations, a portfolio constructed of which pairs of stocks will have the lowest standard deviation?

  The two most basic components of any investment opportunity

The two most basic components of any investment opportunity are risk and return. Define each and explain how they are related in the investment world. Why does their relationship matter to you as an investor?

  Investment asset

Suppose there is an investment asset that pays you 1000 each year end for the next 5 years.

  What is expected dividend per share

Weston Corporation just paid a dividend of $2.25 a share (i.e., D0 = $2.25). The dividend is expected to grow 9% a year for the next 3 years and then at 4% a year thereafter. What is the expected dividend per share for each of the next 5 years?

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