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Mademuasel [1]
3 years ago
8

You are saving for retirement. To live​ comfortably, you decide you will need to save $ 4 million by the time you are 65. Today

is your 25 th ​birthday, and you​ decide, starting today and continuing on every birthday up to and including your 65 th ​birthday, that you will put the same amount into a savings account. If the interest rate is 3 %​, how much must you set aside each year to make sure that you will have $ 4 million in the account on your 65 th ​birthday?
Business
1 answer:
olasank [31]3 years ago
7 0

Answer: $50,846.3701

Explanation:

Need to save $4 million to live comfortably,

Interest rate, r = 3%

N = 40 years

Present\ value=\frac{FV_{N} }{(1+i)^{N}}

Present\ value=\frac{4,000,000 }{(1+0.03)^{40}}

Present\ value=\frac{4,000,000 }{3.262}

                             = 1,226,241.57

Present\ value\ of\ annuity= C\times\frac{1}{i}\times(1-\frac{1}{(1+i)^{N}}) + C

1,226,241.57= C\times\frac{1}{0.03}\times(1-\frac{1}{(1.03)^{40}})+C

1,226,241.57= C\times\frac{1}{0.03}\times(1-\frac{1}{(1.03)^{40}})+C

1,226,241.57=C[\frac{1}{0.03}\times(1-0.3065)+1]

1,226,241.57=24.1166\times C

C=\frac{1,226,241.57}{24.1166}

         = $50,846.3701

Hence, $50,846.3701 will be the annual payment to have $4 million in the account on 65th birthday.

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Jamestown Supply is trying to decide whether to lease or buy some new equipment. The equipment costs $72,000, has a 4-year life,
DochEvi [55]

Answer:

$15,708

Explanation:

Calculation to determine What is the amount of the aftertax lease payment

Using this formula

Aftertax lease payment=Leased equipment(1-Tax rate)

Let plug in the formula

Aftertax lease payment = $23,800 (1 - 0.34)

Aftertax lease payment=$23,800(.66)

Aftertax lease payment = $15,708

Therefore the amount of the aftertax lease payment is $15,708

3 0
2 years ago
A deadweight loss is a consequence of a tax on a good because the tax a. induces the government to increase its expenditures. b.
zalisa [80]

Answer:

B) induces buyers to consume less, and sellers to produce less.

Explanation:

Taxes are a necessary evil since they always increase the price of the goods and services that consumers buy and decrease the amount of money that producers receive from selling their goods and services. But taxes are necessary and unavoidable.

But once a market assumes all the effects of existing taxes it reaches an equilibrium price that both consumers and producers are satisfied with. If a new tax is levied than the deadweight losses are greater since consumer surplus and producer surplus are both reduced. This will lead to a reduction in the incentive that both consumers and producers have to engage in transactions. Many times consumers will substitute heavily taxed goods for other goods since they feel they are getting more from consuming those goods (consumer surplus). The same happens to producers, many producers will change their heavily taxed goods for other goods.

If the price elasticity of demand or supply of a certain good is large (elastic demand and supply), the deadweight loss will be greater.

7 0
3 years ago
NEED HELP ASAP, WILL GIVE BRAINLIEST
mafiozo [28]
The answer is two and five.
4 0
2 years ago
A furniture factory's employees work overtime to finish an order that is sold on January 31. The office sends a statement to the
Lana71 [14]

Answer:

January

Explanation:

The overtime wages should be expensed in January as in the month of february, wages will be accrued and it will be liablity for employer.

The overtime worked in month on january should be paid in january itself and overtime expense should be included in wages payable in the month of January. When wages are paid, the owner of the factory should debit the wages payable account and cash account should be credited as amount of casg paid to the employees. Wages are considered as operating expenses of factory.

4 0
3 years ago
Railway Cabooses just paid its annual dividend of $3.10 per share. The company has been reducing the dividends by 10.9 percent e
Vlada [557]

Answer:     Po = Do(1+g)/Ke-g

                  Po = $3.10(1-0.109)/0.13 - (-0.109)

                  Po = $3.10(0.891)/0.13+0.109

                  Po = $3.10(0.891)/0.239

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Explanation: The current market price of the stock equals the current dividend paid multiplied by 1+g divided by the excess of cost of equity over growth rate. The growth rate is negative in this case, thus, the growth rate would be deducted from 1. Moreso, the growth rate will be added to cost of equity since it is negative. Thus, the amount that the investor will be willing to pay is $11.56.

7 0
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