Answer:
$108,622.60
Explanation:
Calculation for the amount Janine's IRA will worth when she needs to start withdrawing money from it when she retires
Based on the information given we were told that She has the amount of $5,000 in an IRA, which is a vital part of her retirement nest egg in which She has well believes that her IRA will increase at an annual rate of 8%.
Secondly we were told that she is 25 age and plan to retire at the age of 65 which means that the number of years until her retirement will be 40 years(65 years-25 years)
Now let calculate how much she will be worth using this formula
Amount worth= Present value in IRA*(Annual rate increase)^ Numbers of years until retirement
Let plug in the formula
Amount worth=5,000 *(1 + 0.08)^40 =
Amount worth=5,000*(1.08)^40
Amount worth =5,000*21.72452
Amount worth= $108,622.60
Therefore Janine's IRA will be worth $108,622.60 when she needs to start withdrawing money from it when she retires.
Answer: 30.3%
Explanation:
Because taxes are not paid on municipal bond interest, their interest rates are usually lower with the difference accounting for the taxes paid.
For a municipal bond to be similar to a corporate bond, the tax rate must be such that it makes them equal:
Municipal bond return = Corporate bond return * (1 - tax rate)
5.75% = 8.25% * (1 - tax)
1 - tax rate = 5.75% / 8.25%
1 = 0.6969697 + Tax rate
Tax rate = 1 - 0.6969697
= 30.3%
When the birthrate in the US increases, there would be an increase in the demand for college education. The demand curve would shift to the right.
<h3>What would happen in birth rate increase?</h3>
When birth rate increases, there would be more children in the country. This would lead to more people needing college education. As a result, the demand for college education increases and this would shift the demand curve to the right.
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The five foundations of trade are:
- incentives
- tradeoffs
- opportunity cost
- marginal thinking,
- principle that trade creates value.
<h3>Why do we engage in trade?</h3>
There are five main foundations of trade that are the reason why people engage in trade. One of them is the profit incentive to make money from trade. Another is the tradeoffs that people are forced to make to survive.
Opportunity cost also leads to trade because people give up one thing for another and so may have to sell the thing they gave up to receive the thing they want. There is also the principle which posits that when we trade, value is created. Finally, there is marginal thinking which is thinking along the lines of the benefit of one additional unit.
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