You can invest in a mutual fund that generates 9% return per year. If you want to have $700,000 in your account 10 years from now, how much would you have to deposit, at the end of each year, for the next 10 years?
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You can invest in a mutual fund that generates 9% return per year. If you want to have $700,000 in your account 10 years from now, how much would you have to deposit, at the end of each year, for the next 10 years?
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- You want to invest $8,000 at an annual Interest rate of 8% that compounds annually for 12 years. Which table will help you determine the value of your account at the end of 12 years? A. future value of one dollar ($1) B. present value of one dollar ($1) C. future value of an ordinary annuity D. present value of an ordinary annuityUse the tables in Appendix B to answer the following questions. A. If you would like to accumulate $4,200 over the next 6 years when the interest rate is 8%, how much do you need to deposit in the account? B. If you place $8,700 in a savings account, how much will you have at the end of 12 years with an interest rate of 8%? C. You invest $2,000 per year, at the end of the year, for 20 years at 10% interest. How much will you have at the end of 20 years? D. You win the lottery and can either receive $500,000 as a lump sum or $60,000 per year for 20 years. Assuming you can earn 3% interest, which do you recommend and why?Use the tables in Appendix B to answer the following questions. A. If you would like to accumulate $2,500 over the next 4 years when the interest rate is 15%, how much do you need to deposit in the account? B. If you place $6,200 in a savings account, how much will you have at the end of 7 years with a 12% interest rate? C. You invest $8,000 per year for 10 years at 12% interest, how much will you have at the end of 10 years? D. You win the lottery and can either receive $750,000 as a lump sum or $50,000 per year for 20 years. Assuming you can earn 8% interest, which do you recommend and why?
- You expect to receive a payout from a trust fund in 5 years. The payout will be for $12,200. You plan to invest the money at an annual rate of 6.9 percent until the account is worth $20,800. How many years do you have to wait from today?If you invest $10,000 in a savings account that earns 5% interest per year, how much will you have in 10 years? How does this amount compare to investing the same amount in a mutual fund that earns an average of 8% per year?You are planning to contribute $8,000 a year into a mutual fund that earns an average of 8% per year. If you continue to contribute for the next 10 years, how much would you have in your account?
- You want to retire soon. When you finally retire, you want your investments to provide you with an income of $150,00 each year for the next 40 years. If the annual interest rate guaranteed to be 6 percent or higher, what is the present value of that stream of payments (or how much of a deposit do you need in order to get that payment amount per year)?In wisely planning for your retirement, you invest $12,000 per year for 20 years into a 401(k) account. How much can you withdraw each year for 10 years, starting one year after your last deposit, if you obtain a real return of 10% per year? Assume the inflation rate averages 2.8% per year.An investment will give you monthly payments of $1972.19 for 8 years. You will receive your first payment today. If your required return is 9.6%, what is it worth today? You plan to start investing and will invest $180.94 per month. You will make your first deposit today. If the rate is 8.4%, how much will you have in 15 years?
- Chuck Tomkovick is planning to invest $25,000 today in a mutual fund that will provide return of 8% each year. What will be the value of the investment in 10 years?You are planning to save for retirement over the next 30 years. To do this, you will invest $1,300 a month in a stock account and $1,000 a month in a bond account. The return of the stock account is expected to be 10 percent, and the bond account will pay 5 percent. When you retire, you will combine your money into an account with a return of 7 percent. How much can you withdraw each month from your account assuming a 15-year withdrawal period? Multiple Choice $1,102,254.13 $34.571.73Your savings currently are invested in an investment product generating 5.2% EAR. You are considering moving your money into a mutual fund expected to generate payments of $11,000 every 5 years. The first payment will be received five years from now and payments will continue unchanged forever. If the mutual fund is the same risk as your current investment product, what is the value today of the mutual fund investment?