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
valkas [14]
3 years ago
15

This is a classic retirement problem. A time line will help in solving it. Your friend is celebrating her 35th birthday today an

d wants to start saving for her anticipated retirement at age 65. She wants to be able to withdraw $125,000 from her savings account on each birthday for 20 years following her retirement; the first withdrawal will be on her 66th birthday. Your friend intends to invest her money in the local credit union, which offers 7 percent interest per year. She wants to make equal annual payments on each birthday into the account established at the credit union for her retirement fund.
a. If she starts making these deposits on her 36th birthday and continues to make deposits until she is 65 (the last deposit will be on her 65th birthday), she must deposit $______ annually to be able to make the desired withdrawals at retirement.
b. Suppose your friend has just inherited a large sum of money. Rather than making equal annual payments, she has decided to make one lump sum payment on her 35th birthday to cover her retirement needs. This deposit will have to be in the amount of $_____ .
c. Suppose your friend's employer will contribute $3500 to the account every year as part of the company's profit-sharing plan. In addition, your friend expects a $175,000 distribution from a family trust fund on her 55th birthday, which she will also put into the retirement account. She must deposit $_________ annually now to be able to make the desired withdrawals at retirement.
Business
1 answer:
xeze [42]3 years ago
7 0

Answer:

a. $21,725.65

b. $19,385

c. 27,421.32

Explanation:

Savings = 125,000

Annuity Formula :

(\frac{1}{1.07})^{30} [  \frac{125,000}{0.07} ( 1 - \frac{1}{1.07 ^}^{20} ) ] = \frac{A}{0.07} ( 1 - \frac{1}{0.07 ^ } ^{30} )

Solving the equation we get,

A  = $21,725.65

You might be interested in
Russell, an entrepreneur, wants to hire a human resource professional who can help him make decisions about who will or will not
worty [1.4K]

Answer: Recruitment manager

Explanation: Recruitment manager are managers working in relation with the human resource department of the organisation and are responsible for hiring and firing of the personnel in the organisation. The main role of recruitment manager is to find competent employees to the organisation at a reasonable cost. Recruitment managers perform functions like interviews , reference check and background check etc for competent employees recruitment.

4 0
3 years ago
Read 2 more answers
Summers, Inc., is an unlevered firm with expected annual earnings before taxes of $32.5 million in perpetuity. The current requi
mezya [45]

Answer:

Check the explanation

Explanation:

Check the attached image below for:

1) Value of equity = EBIT x (1 - tax) / Cost of equity

2) Stock Price

3) PV of tax shield

Value of the firm

4) Price per share

5) No. of shares repurchased

6) New price

7) Value of equity = (EBIT - Interest) x (1 - tax) / Cost of equity

8 0
3 years ago
If GDP for a certain economy is $1,200 billion at the end of year 1 and $1,300 billion at the end of year 2, the economy's growt
gavmur [86]

Answer:

a. 8.33 percent

Explanation:

The computation of the economy's growth rate between the two years is presented below:

= (GDP at the end of year 2 - GDP at the end of year 1) ÷ (GDP at the end of year 1) × 100

= ($1,300 billion - $1,200 billion) ÷ ($1,200 billion)  × 100

= ($100 billion) ÷ ($1,200 billion)   × 100

= 8.33%

The economic growth rate is always expressed in percentage form

5 0
3 years ago
Jean works for Fahrenheit Publishing which is a publisher of scientific journals. The company is dominated by low risk taking an
Alexxx [7]

Answer:

C) Jean's department has developed a subculture

Explanation:

Based on the information provided within the question it can be said that Jean's department has developed a subculture. This refers to a culture within a larger culture. Which seems to be the case since the company itself focuses solely on low risk taking and high attention to detail. While Jean's department focuses mainly on high team orientation including working together and socializing through various activities.

8 0
4 years ago
A company has an operating income of $100 million, depreciation of $15 million, an asset sale of $50 million, a capital expendit
Alexus [3.1K]

Answer:

145 millons free cash flow for the year

Explanation:

100 operating income

+ 15 depreciation (this expense do not involve cash, so they add up cash)

+50 long term asset sales (more cash in form of currency)

-10 capital expenditure (cash used purchase, mantaing or improve their assets)

-10 investment in working capital (we use it to adquire assets or pay liabilities)

-----

145 millons free cash flow for the year

6 0
4 years ago
Other questions:
  • Assume that the demand for tuna in a small coastal town is given by p = 400,000 q1.5 , where q is the number of pounds of tuna t
    6·1 answer
  • Which of the following statement is TRUE about variable expenses?
    6·2 answers
  • U.S. Steel and Nucor (the two remaining major players in the U.S. steel industry) have been forming alliances as a means to ente
    7·1 answer
  • Like many other professional organizations and businesses, the American Marketing Association has developed a formal, written gu
    15·1 answer
  • Solar Innovations Corporation bought a machine at the beginning of the year at a cost of $25,000. The estimated useful life was
    15·1 answer
  • FedEx Corporation (FDX) had the following revenue and expense account balances (in millions) for a recent year ending May 31:
    14·1 answer
  • A company purchases inventory on account for $45,000 with terms 2/10, n/30. Under the net method of accounting for purchases, th
    11·1 answer
  • You have ​$750,000 in an IRA​ (Individual Retirement​ Account) at the time you retire. You have the option of investing this mon
    10·1 answer
  • The investor is worried that the beta of his portfolio is too high, so he wants to sell some stock C and add stock D, which has
    10·1 answer
  • When applying a questioning mindset, what follows identify whether there is sufficient evidence to support the conclusion?.
    5·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!