1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
ziro4ka [17]
3 years ago
11

You want to be a millionaire when you retire in 40 years. a. How much do you have to save each month if you can earn an annual r

eturn of 11.6 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. How much do you have to save each month if you wait 10 years before you begin your deposits? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. How much do you have to save each month if you wait 20 years before you begin your deposits? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Business
1 answer:
oksano4ka [1.4K]3 years ago
7 0

Answer:

The answers are:

a. 1866.79

b. 2489.05

c. 3733.57

Explanation:

a. Let us begin by calculating the total amount to be saved each year.

Let the total amount to be saved each year be "m"

annual return = 11.6% of m = 11.6 ÷ 100 = 0.116 of m

Therefore to be a millionaire in 40 years, the total amount saved for the year + the annual return on that amount when multiplied by 40 will yield 1 million. It is represented thus:

(0.116m + m) × 40 = 1,000,000

= (1.116m) × 40 = 1,000,000

44.64m = 1,000,000

∴ m = 1,000,000 ÷ 44.64 = 22401.433691756

therefore amount to be saved for a year = 22401.433691756

to calculate amount to be saved each month we divide this amount by 12, because 12 calendar months make one year. Hence;

amount to be saved each month = 22401.433691756 ÷ 12 = 1866.79 (to 2 decimal places).

b. If you wait 10 years, then you have only 30 years left to save

since the annual return remains the same,

(0.116m + m) × 30 = 1,000,000

(1.116m) × 30 = 1,000,000

33.48m = 1,000,000

∴ m = 1,000,000 ÷ 33.48 = 29868.578255675 (amount to be saved for a year)

Therefore amount to be saved per month = 29868.578255675 ÷ 12 = 2489.05 ( to 2 decimal places)

c. If you wait 20 years before saving, you hve 20 years more to save.

Since the annual return remains the same;

(1.116m) × 20 = 1,000,000

22.32m = 1,000,000

m = 1,000,000 ÷ 22.32 = 44802.867383512 (yearly amount to be saved)

Therefore amount to be saved per month = 44802.867383512 ÷ 12 = 3733.57 ( to 2 decimal places).

You might be interested in
During 2017 sales on account were $390,000 and collections on account were $230,000. also, during 2017 the company wrote off $22
Scilla [17]

Answer:

[(Accounts receivable at the beginning of the year + $138,000) - $144,000] - cash realizable value at the beginning of the year

Explanation: The question is incomplete but just apply the missing figures: [(Accounts receivable at the beginning of the year + Sales on account - Collections on account - write off) - bad debt] - cash realizable value at the beginning of the year

[(Accounts receivable at the beginning of the year + $390,000 - $230,000 - $22,000) - $144,000] - cash realizable value at the beginning of the year

5 0
3 years ago
Read 2 more answers
A _____ plan gives all employees a minimum level of benefits and a set amount to spend on flexible benefits, such as additional
Katarina [22]

Answer:

Cafeteria Plan

Explanation:

The cafeteria plan is minimum benefits that the employer have to provide or personally provide to all the employees working in its organization. In some jurisdictions like USA and Europe, the employer has to provide minimum level of facilities and benefits to the employee which inculdes healthcare, pension contributions, etc.

5 0
2 years ago
As an 18 year old in Alabama I know that the age majority is 19, and I can't drop out of high school without parent permission b
Julli [10]

Answer:

No, Alabama can't make you come back. But that is just my opinion. Please don't listen to me

3 0
2 years ago
Read 2 more answers
g Curtis invests $425,000 in a city of Athens bond that pays 6.25 percent interest. Alternatively, Curtis could have invested th
Advocard [28]

Answer:

The explicit tax would Curtis incur on interest earned on the Initech, Inc. bond is $7,395

Explanation:

The computation of the explicit tax is shown below:

= (Invested amount × interest rate with similar risk) × marginal tax rate

= ($425,000 × 7.25%) × 24%

= $30,812.50 × 24%

= $7,395

We consider the invested amount, similar risk interest rate, and the marginal tax rate. The paying interest rate would not be considered. Hence, ignore it

5 0
3 years ago
The theory that quantity supplied and price are positively related, other things constant, is referred to as the law of: opportu
vova2212 [387]
The theory that quantity supplied and price are positively related, other things constant is referred to as the law of supply. The law of supply states that when there is an increase in the prices of goods and services there is also an increase in the supply of such goods and services.
7 0
3 years ago
Other questions:
  • 1.
    12·2 answers
  • A clothing store has ordered 100,000 swimsuits. It costs $22 to produce a swimsuit. They plan to sell them until August 31 at a
    12·1 answer
  • Review and complete the following statement regarding the Income Summary account. The Income Summary account is (debited/credite
    10·1 answer
  • This information relates to Sherper Co. 1. On April 5 purchased merchandise from Newport Company for $22,000, terms 2/10, n/10.
    14·1 answer
  • In countries with minimal corruption ________. the contribution of the private sector to the national GDP is negligible financia
    8·1 answer
  • The financial statements of Trenton Office Supply include the following​ items: 2019 2018 Cash $ 46 comma 500 $ 43 comma 000 Sho
    14·2 answers
  • Suppose you are considering the purchase of an apartment building that has 12 units that can be rented out at $1,050 per month.
    7·2 answers
  • 70 Marketing Dynamics .. .. : : . . : Part 4: Be Your Own Leader Leaders on a Top Secret Mission On December 6, 2011, a woman wa
    14·1 answer
  • when an organization produces only a single product and attempts to sell it to two or more market segments, it avoids which cost
    9·1 answer
  • The ____ is a private corporation owned by a consortium of commercial banks and industrial companies, but the ____ is a self-sus
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!