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3 years ago

8

Taylor has a retirement account that pays 4% per year compounded monthly. Every month for 20 years, Taylor deposits $444, with t

he first deposit at the end of month 1. The day the last deposit is made, the interest rate increases to 6% per year compounded monthly. During retirement, Taylor plans to make equal monthly withdrawals for 15 years, thus depleting the account. The first withdrawal occurs one month after the last deposit. How much can be withdrawn each month?

1 answer:

cupoosta [38]3 years ago

6 0

Answer:

Taylor can withdrawn 1,374.20 dollars each month

Explanation:

Timeline:

deposits of 444 for 20 years = withdrawals of X for 15 years

<-----/-/-/-/-/-/-/-/-/-/-/-/-/-/-/-/-/---\\-\-\-\-\-\-\-\-\-\-\-\->

We must calcualte amount to satisfy:

future value of his deposits = present value of his withdrawals

We first need to get the future value of the retirement account

and then the PMT this fund can do.

<u>deposits future value:</u>

$C \times \frac{(1+r)^{time} -1}{rate} = FV\\$

C $ 444

time 240 (20 years x 12 months er year)

rate 0.003333333 ( 0.04 annual rate / 12 months = monthly rate)

$444 \times \frac{(1+0.003333333)^{240} -1}{0.003333333} = FV\\$

FV $162,847.9340

<u>withdrawals PMT:</u>

$PV \div \frac{1-(1+r)^{-time} }{rate} = C\\$

PV $162,847.93

time 180

rate 0.005

$162847.93 \div \frac{1-(1+0.005)^{-180} }{0.005} = C\\$

C $ 1,374.203

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November Avenue, Inc. wants to have $7,500,000 in an account exactly 16 years from today. They will make equal quarterly payment

Nata [24]

Answer:

$315,717.03

Explanation:

Let us start by first of determining the future value of $50,000 quarterly payments for 16 years using the future value of an ordinary annuity provided below:

FV=quarterly payment*(1+r)^n-1/r

quarterly payment=$50,000

r=quarterly interest rate=8%/4=2%

n=number of quarterly payments in 16 years=16*4=64

FV=$50,000*(1+2%)^64-1/2%

FV=$50,000*(1.02)^64-1/0.02

FV=$50,000*(3.551493243 -1)/0.02

FV=$50,000*2.551493243 /0.02

FV=$6,378,733.11

The future value above fell short of the target $7,500,000, it means a fixed amount would have to be invested at 8% compounded quarterly for 16 years as well

shortfall=$7,500,000-$6,378,733.11=$1,121,266.89

The present value of the shortfall that would be invested today is computed

PV=FV/(1+r)^n

FV=$1,121,266.89

r=quarterly interest rate=2%

n=number of quarters in 16 years=64

PV=$1,121,266.89/(1+2%)^64

PV=$315,717.03

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3 years ago

1. What determines the degree of specialization within an organization?

Aneli [31]

1. What determines the degree of specialization within an organization? The organizational structure of the company determines the degree of specialization within an organization. Dependent on how the organization is broken up into categories allows the organization to figure out how they are able to control and break down their organizations speciality.

2. What three steps are involved in delegation? The three steps involved in delegation include: Assigning responsibility, granting authority and creating accountability. Assigning responsibility refers to giving those who are able to perform a task the duty to perform it. Granting authority is giving someone authority to make a power decision in a given situation to complete the task. Creating accountability refers to making sure an employee knows they are to finish the task and needs to be successful in doing so.

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4 years ago

Read 2 more answers

The perimeter of the base of the Washington monument is 220.5 feet. If the width is equal to its length, what are the dimensions

natita [175]

Answer:

both the Width and Length of the base are equal to 55.125 ft

Explanation:

Based on the information provided by the question we know that the width is equal to the length, therefore the base of the Washington Monument is a Square. The Perimeter of a Square is equal to the addition of all four sides (length and width).

$P = W+W+L+L$

Therefore since we know that the perimeter is 220.5 and all 4 sides are equal then we can <em>divide</em> the perimeter by 4 in order to know the size of the the sides

220.5 / 4 = 55.125 ft

Finally we can see that both the Width and Length of the base are equal to 55.125 ft

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3 years ago

Applied methods corporation promises to give stock options to belden, a production designer, for processes he has already design

masya89 [10]

Applied methods corporation promises to provide stock options to Belden, a production designer, for processes he has already designed. This promise exists unenforceable.

<h3>What is a promise in Contract?</h3>

A contract is an enforceable legal arrangement that establishes, details, and regulates the rights and duties of the parties. The transfer of commodities, services, money, or a promise to transfer any of those at a later time are common components of contracts. All business is conducted through contracts, which are mutual agreements between two (or more) parties that, once signed, impose binding legal duties on each party. Simple solutions for this include purchasing something or offering a service.

A contract, however, is enforceable in a court of law. There are no legal ramifications for breaking a promise in the same way that there are for breaching a contract, yet persons of honor and high moral character try to fulfil their word whenever feasible. A promise or set of promises is referred to as a contract if the law recognizes a duty to perform them or if there is a legal remedy for their breach.

Hence, Applied methods corporation promises to provide stock options to Belden, a production designer, for processes he has already designed. This promise exists unenforceable.

To learn more about Contract refer to:

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2 years ago

Assume Chester Corp. is downsizing the size of their workforce by 20% (to the nearest person) next year from various strategic i

Tasya [4]

Answer:

$311,100

Explanation:

Solution

Recall that:

Assume Chester corp downsized the size of their workforce by = %

The exit interviews cost estimated = 100

Additional normal costs of separation = $5000

Now,

The Total Employee = 305

The Down Sizing = 20%

Thus,

The Total Employee = 305 x 20% = 61 employees

so,

The Separation cost per employees = $5000

The Exit interview cost = $100

Total cost = $5,100

Now,

The total overall cost of separation = 61 employees x total cost of separation per employees

Which is,

= 61 x 5100 = = $311,100

3 0

4 years ago