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Harrizon [31]
3 years ago
8

Mr. Wise is retiring In 25 years He would like to accumulate $1,000.000 for his retirement fund by then He plans make equal mont

hly payments to achieve his goal If the rate of return on the retirement fund is 12% (APR), what will his monthly payments be?
Business
1 answer:
Montano1993 [528]3 years ago
7 0

Answer:

$532.24

Explanation:

Since Mr. Wise will be making monthly payments for the period of 25 years in order to accumulated the $1,000,000 at the end of 25 years, therefore, the future value of annuity shall be used to determine the monthly payments to be deposited by Mr Wise. The formula of future value of annuity is given as follows:

Future value of annuity=R[((1+i)^n-1)/i]

In the given scenario:

Future value of annuity=amount after 25 years=$1,000.000

R=monthly payments to be deposited by Mr Wise=?

i=interest rate per month=12/12=1%

n=number of payments involved=25*12=300

$1,000,000=R[((1+1%)^300-1)/1%]

R=$532.24

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Condensed financial data are presented below for the Phoenix Corporation:
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Answer:

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<em><u>Interpretation: </u></em> from evey dollar of sales the firm achieves almost 8 cent of net income

inventory turnover ratio 3.45

<em><u>Interpretation: </u></em>the inventory is sold 3 and a half times during the year

Explanation:

the profit margin is the quotient between net income and sales.

\frac{net \: income}{sales} = $profit margin

127,500 / 1,640,000 = 7.77%

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(312,500 + 257,500)/ 2  = 285,000

982,500 / 285,000 = 3,447368421

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3 years ago
Consider the following information: Portfolio Expected Return Beta Risk-free 6 % 0 Market 10.2 1.0 A 8.2 1.4 a. Calculate the re
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Answer:

a. 11.88%

b. -3.68%

Explanation:

Given that

Risk free rate = 6%

Beta = 1.4%

Market rate = 10.2%

Risk free rate = 6%

Alpha return = 8.2%

a. The computation of expected return of portfolio is given below:-

= Risk free rate + Beta (Market rate - Risk free rate)

= 6% + 1.4% (10.2% - 6%)

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= Alpha return - Expected return

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3 years ago
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Dmitriy789 [7]

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2. A depositor puts $25,000 in a saving account that pays 5% interest, compounded semiannually. Equal annual withdrawals are to
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Answer:

The correct answer is $1265.60.

Explanation:

According to the scenario, the given data are as follows:

Present Value (PV) = $25,000

Rate of interest = 5%

Rate of interest ( semi annual) (r) = 2.5%

Time period (semi annual) = 2

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