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Colt1911 [192]
3 years ago
7

In planning for your retirement, you have decided that you would like to be able to withdraw $60,000 per year for a 10 year peri

od. The first withdrawal will occur 20 years from today.
a. What amount must you invest today if your return is 10% per year?
b. What amount must you invest today if your return is 15% per year?
Business
1 answer:
Cloud [144]3 years ago
7 0

Answer:

a. $66,309

b. $24, 333

Explanation:

In both scenarios, the Cash Flows are uneven. thus we need to be careful the way we use the Time Value of Money. What we will be looking for is the Net Present Value - the Initial cost of the Investment.

Step 1

The summary of cash flows for this project can be shown as follows :

Year 0 = ? (to be calculated)

Year 1 to Year 19 = 0

Year 20 to Year 30 = $60,000

Step 2

Using the CFj Function of the Financial calculator, we can then calculate the Net Present Value as :

<u>Part a</u>

$0                       CFj

19                          Nj

$60,000             CFj

10                          Nj

10 %                   I/YR

Shift NPV = $66,309

<u>Part b</u>

$0                       CFj

19                          Nj

$60,000             CFj

10                          Nj

15 %                   I/YR

Shift NPV = $24,333

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A. Assuming that employees would understand the content of the PowerPoint slides

Explanation:

One of the most common mistakes that can be made is assuming that the receiver on the other end of the communication chain would understand quite well, what message, you as the sender, is passing across.

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kobusy [5.1K]

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D

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Explain why a business needs to keep variable costs low and high variable costs impact the business.
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The computation is shown below:

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3 0
3 years ago
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