A family spends $30,000 a year for living expenses. If prices increase by 5 percent a year for the next three years, what amount will the family need for their living expenses after three years?
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A family spends $30,000 a year for living expenses. If prices increase by 5 percent a year for the next three years, what amount will the family need for their living expenses after three years?
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- A family spends $46,000 a year in living expenses.If prices increase 3% a year for the next 3 years what amount will family need for their living expenses after 3 years?Suppose your parents have just retired and have $1 million in a retirement account. For how many years can they withdraw $5,000 at the beginning of each month for expenses, assuming that the account will continue to earn a 5 percent annual return until it is exhausted?A family spends $46,000 a year for living expenses. If prices increase by 3 percent a year for the next three years, what amount will the family need for their living expenses after three years? (LO 1.1)
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- How much do you need to save each year for 30 years in order to have $775,000, assuming you are investing the money in an account that earns 8%? How much of the $775,000 comes from contributions (your out of pocket costs)?Suppose a newlywed couple is planning to buy a home two years from now. To save the down payment required at the time of purchasing a home worth $400,000 (let's assume this required down payment is 25% of the sales price, or $100,000), the couple has decided to set aside some money from their salaries at the end of each month. If the couple can earn 9% interest (compounded monthly) on their savings, determine the equal amount the couple must deposit each month so that they may buy the home at the end of two years.A family is saving for their child's education. They want to have $80,000 eighteen years from now . a.) How much do they need to deposit each month into an account earning 7.2% interest compounded monthly? b.) What is the interest earned on the account?
- A father is trying to save for his daughter’s wedding in two years. (Long engagement!). He thinks he can make the following contributions to an account: $14,545.00 today and $13,130.00 in one year. The father thinks he can earn 7.00% in the market each of the next two years. If the wedding is expected to cost $52,815.00 two years from today, how much will he need to contribute at the time of the wedding to cover its cost?A couple wants to purchase a house. Suppose they invest $500 per month into an ordinary annuity. How much will they have for a down payment after 9 years if the annual interest rate is 9% compounded monthly?Your grandparents leave on their dream vacation to Antartica in three years. The cruise vacation will cost them $24,000. If they have already saved $22,500 and are inveting it at a rate of 2.50% per year, will they have saved enough money for their trip?