Question: Your job pays you only once a year for all the work you did over the previous 12 months.Today, December 31, you just received your

Your job pays you only once a year for all the work you did over the previous 12 months.Today, December 31, you just received your salary of $50,000 and you plan to spend it all.However, you want to start saving for retirement beginning next year.You have decided that one year from today you will begin depositing 5 percent of your annual salary in an account that will earn an APR of 10.482 percent compounded monthly.Your salary will increase at 4 percent per year throughout your career.

a.Should banks report EARs instead of APRs? Why or why not?

b.Calculate the appropriate discount rate for this problem (round your answer to the nearest 1 percent and use it for the remaining questions).

c.How much money will you have on the date of your retirement 40 years from today?

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