How much will it cost Shaun to purchase a two-level retirement annuity that will pay $6000 at the end of each month for the first 10 years, and $9000 per month for the next 15 years? The payments represent a rate of return to Shaun of 6% compounded monthly Select one OA $2 193 174 OB $11266402 OC $540 441 OD $506 201 OE $1066 532
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- Funding a retirement goal. Austin Miller wishes to have 800,000 in a retirement fund 20 years from now. He can create the retirement fund by making a single lump-sum deposit today. a. If upon retirement in 20 years, Austin plans to invest 800,000 in a fund that earns 4 percent, what is the maximum annual withdrawal he can make over the following 15 years? b. How much would Austin need to have on deposit at retirement in order to withdraw 35,000 annually over the 15 years if the retirement fund earns 4 percent? c. To achieve his annual withdrawal goal of 35,000 calculated in part b, how much more than the amount calculated in part a must Austin deposit today in an investment earning 4 percent annual interest?You want to retire exactly 35 years from today with $1,990,000 in your retirement account. If you think you can earn an interest rate of 10.23 percent compounded monthly, how much must you deposit each month to fund your retirement? Multiple Choice O O $580.31 $4,738.10 $526.79 $489.69 $493.87How much money does Suzie need to have in her retirement savings account today if she wishes to withdraw $25,000 a year for 3 years? She expects to earn an average rate of return of 13 percent. A. $59,028.81 OB. $65,419.81 OC. $71,533.33 OD. $85,160.98 E. $87,391.34
- How long would it take for you to save an adequate amount for retirement if you deposit $40,000 per year into an account beginning today that pays 12 percent per year if you wish to have a total of $1,000,000 at retirement? O a. 12.2 years O b. 10.5 years O c. 14.8 years O d. 11.5 yearsSally Mander wants to set up a perpetual annuity for herself that will pay $60,000 annually that will begin 40 years from now Assuming an interest rate of 8% and with the impact of inflation of 3%, how much will Sally need to save annually? $6,930 O $4,632 O $3,936 O $5,932How much would you be willing to spend for an annuity that pays $2,500 at the end of each year for three years, assuming you could earn 5.5% on other LIET similar investments? Select one: O a. $5,494 O b. $4,783 O c. $6,087 O d. $6,408 O e. $6,745 ہے
- The Time Value of an AnnuityQuestion #2: Suppose you have just started 26th year of your life, you plan to retire atthe end of age 65, and you expect to live until the end of 85 (working for 40 full yearsand being retired for 20 years). You are currently earning $48,000 per year (paidmonthly at the end of each month) which grows 2.4% each year (0.2% per month). Youwant to consume $2,500 per month when you retire with the growth rate of 0.2% permonth. The plan is to save a fixed percentage of your income each month to meet yourretirement needs.Part A: Assuming an interest rate of 3% (annual percentage rate, compounded monthly),what is your saving rate?Part B: Assuming an interest rate of 6% (annual percentage rate, compounded monthly),what is your saving rate?Part C: How can you explain the change in saving rate in response to the change ininterest rate? Discuss.How do you solve this on TI 84 Future Value of Multiple Annuities Assume that you contribute $110 per month to a retirement plan for 20 years. Then you are able to increase the contribution to $210 per month for another 20 years. Given a 6.5 percent interest rate, what is the value of your retirement plan after 40 years?After retirement, you expect to live for 25 years. You would like to have $91,000 in income each year. How much should you have saved in your retirement account to receive this income if the annual interest rate is 9 percent per year? (Assume that the payments start one year after your retirement) Multiple Choice $1,472.33173 $893,85474 $2,275,000.00 $101,089.74
- QUESTION 8 Your mother has an annuity that will give her monthly payments for 14 years. She tell you it is worth $124357 today. If her required return is 11.56%, what is the monthly payment?7How much more is a perpetuity paying $5000 at the end of year worth than an annuity paying the same annual amounts at the end of each year for 30 years? Assume an interest rate of 5%. a. $10,635.08 b. $21,976.29 c. $50,000.00 d. $23,137.74 8Miller's Hardware plans on saving $40,000, $50,000, and $58,000 at the end of each year for the next three years, respectively. How much will the firm have saved at the end of the three years if it can earn 6% by reinvesting its saving? a. $155,944.00 b. $169,004.13 c. $148,000.00 d. $148,078.15 9On the day you retire you have $500,000 saved. You expect to live another 30 years during which time you expect to earn 8% on your savings while inflation averages 3.5% annually. Assume you want to spend the same amount each year in real terms and die on the day you spend your last dime. What real amount will you be able to spend each year? a. $61,931.78 b. $79,211.09 c. $79,644.58 d. $30,695.77How much can you live on each month with this retirement plan if you are retiring in 38 years? Monthly savings 731 Amount you have reaty today to invest 10,965 Pre - retirement interest rate you can earn 11% post - retirement interest rate yo can earn 6% When you retire, you'll spend 200,000 for a trip around the world You plan to live 30 years after retirement and leave 2 million$ to your children. Monthly living allowance: