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Naddik [55]
2 years ago
13

Amy​ Parker, a​ 22-year-old and newly hired marine​ biologist, is quick to admit that she does not plan to keep close tabs on ho

w her​ 401(k) retirement plan will grow with time. This sort of thing does not really interest her.​ Amy's contribution, plus that of her​ employer, amounts to ​$2 comma 150 per year starting at age 23. Amy expects this amount to increase by 3​% each year until she retires at the age of 57 ​(there will be 35 EOY​ payments). What is the compounded future value of​ Amy's 401(k) plan if it earns 5​% per​ year?
Business
1 answer:
lakkis [162]2 years ago
6 0

Answer:

Final Value= $370,481.13

Explanation:

Giving the following information:

Amy's contribution, plus that of her​ employer, amounts to ​$2,150 per year starting at age 23. Amy expects this amount to increase by 3​% each year until she retires at the age of 57 ​(there will be 35 EOY​ payments). Interest rate= 5%.

<u>First, we will add the growth of the deposits to the interest rate:</u>

Interest rate= 0.03 + 0.05= 0.08

Now, to calculate the final value, we need to use the following formula:

FV= {A*[(1+i)^n-1]}/i

A= annual deposit= 2,150

i= 0.08

n= 35

FV= {2,150*[(1.08^35)-1]}/ 0.08= $370,481.13

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A business owner makes 50 items by hand in 40 hours. She could have earned $20 an hour working for someone else. Her total expli
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Answer:

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Explanation:

The economic profit calculation is presented below:

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ABC Company produces Product X, Product Y, and Product Z. All three products require processing on specialized finishing machine
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Answer:

400; 800

Explanation:

Contribution:

Product X:

= Selling price - Variable cost

= 100 - 70

= 30,

Product Y:

= Selling price - Variable cost

= 80 - 40

= 40,

Product Z:

= Selling price - Variable cost

= 25 - 20

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Product X:

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Product Y:

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Product Z:

= Machine time per unit × Monthly demand

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Contribution per machine hour:

Product X = Contribution ÷ Machine time per unit

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Product Y = Contribution ÷ Machine time per unit

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Product Z = Contribution ÷ Machine time per unit

                = 5 ÷ 1

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It is highest for Y, so produce maximum amount of Y, then X and then Z

Y needs 400 hrs, we are left with 800 hours, so produce 800 hours of X.

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3 years ago
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