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Phoenix [80]
3 years ago
10

How many years would it take for Jughead to save an adequate amount for retirement if he deposits $2,000 per month into an accou

nt beginning today that pays 12 percent per year if he wishes to have a total of $1,000,000 at retirement
Business
1 answer:
Free_Kalibri [48]3 years ago
7 0

Answer:

The number of year needed to save the amount = 36.2739

Explanation:

The annual deposit amount (A) = $2000

Annual interest rate (r ) = 12 %

The retirement amount or the expected amount at the time of retirement (FV)  = $1000000

Number of years = n

So if the Jughead want the retirement amount $1000000 that has interest rate 12 percent then we need to calculate the number  of years.

Below is the calculation of number of years.

FV = A \frac{(1 + r)^{n}}{r} \\1000000 = 2000 \frac{(1 + 12 \  percent )^{n} - 1}{12 \ percent} \\\frac {1000000}{2000} = \frac{(1 + 12 \  percent )^{n} - 1}{12 \ percent} \\500 = \frac{(1 + 0.12)^{n} - 1}{0.12} \\ n = 36.2739 \ years

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