Lia plans to retire when she turns 70. Lia believes she needs $100,000 per year to...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Lia plans to retire when she turns 70. Lia believes she needs $100,000 per year to live comfortably in her post-work life. She has two children and hope after she has passed away her children and heirs can receive the same amount forever. Required: (b) Lia is 30. She wants to use her superannuation funds to save for the retirement fund and payment for her heirs. The current superannuation balance is $50,000. What is the constant annual superannuation contribution Lia must make until retirement to satisfy the superannuation balance you have calculated in (a)? Use 8% as the rate of return on his superannuation fund. Question B6c Robotic Process Automation Ltd is a fast-growing company and is growing at a constant growth rate of 20%. The company just paid a dividend of $4. The required rate of return is 30%. Required: (c) The current market price of the share is $50. Would you recommend a shareholder to sell or buy more shares? Explain. (2 marks) Lia plans to retire when she turns 70. Lia believes she needs $100,000 per year to live comfortably in her post-work life. She has two children and hope after she has passed away her children and heirs can receive the same amount forever. Required: (b) Lia is 30. She wants to use her superannuation funds to save for the retirement fund and payment for her heirs. The current superannuation balance is $50,000. What is the constant annual superannuation contribution Lia must make until retirement to satisfy the superannuation balance you have calculated in (a)? Use 8% as the rate of return on his superannuation fund. Question B6c Robotic Process Automation Ltd is a fast-growing company and is growing at a constant growth rate of 20%. The company just paid a dividend of $4. The required rate of return is 30%. Required: (c) The current market price of the share is $50. Would you recommend a shareholder to sell or buy more shares? Explain. (2 marks)
Expert Answer:
Answer rating: 100% (QA)
b To calculate the constant annual superannuation contribution Lia must make until retirement we need to determine the present value of the desired re... View the full answer
Related Book For
Fundamentals Of Investing
ISBN: 9780135175217
14th Edition
Authors: Scott B. Smart, Lawrence J. Gitman, Michael D. Joehnk
Posted Date:
Students also viewed these finance questions
-
Planning is one of the most important management functions in any business. A front office managers first step in planning should involve determine the departments goals. Planning also includes...
-
Everett and Rosemary Sexauer, a married couple, both age 52, have come to meet with you and have several questions about retirement. They tell you that they want to retire at age 60 at 100% WRR....
-
Steve Miller ( 45 ) and Brenda Miller ( 45 ) are a married couple with two children Adam 12 and daughter Amy 8 ) . Steve is self - employed electrical contractor and earns $ 125,000 after expenses...
-
As the Developing market of Southern Africa there is endless growth opportunities and constant ask for high growth pushed by the business, this growth comes normally in a very erratic way but as...
-
The International Fisher Effect you observe that the inflation rate in the United States is 3.7 percent per year and that T-bills currently yield 4.3 percent annually. What do you estimate the...
-
Is the United States the nation with the most government debt? If not, who is?
-
Big Screen Amusements Company owns movie theaters. Big Screen engaged in the following business transactions in 2012: Big Screen Amusements uses the following accounts: Cash, Supplies, Building,...
-
A firm pays a $1.50 dividend at the end of year one (D1), has a stock price of $155 (P0), and a constant growth rate (g) of 10 percent. a. Compute the required rate of return (Ke). Indicate whether...
-
1. what are the activities involved for procument in building cryptocurrency? 2. what infrastructure you need in building cryptocurrency? 3. what is the role of human resources in building...
-
Garys TV had the following accounts and amounts in its financial statements on December 31, 2022. Assume that all balance sheet items reflect account balances at December 31, 2022, and that all...
-
In this question we study the recursively defined functions f, g and h given by the following defining equations f(0) = 1 base case 0, f(1) = 0 base case 1, and f(n) = n f(n 1) + f(n 2)^2...
-
What is the status of the legal personhood held by women who have experienced coerced sterilization with specific case references in Canada? You will need to research this very topic based on...
-
Inside a radiation therapy device, an electron is in the presence of a uniform electric field with a magnitude of 285 N/C. (a)What is the magnitude of the acceleration of the electron (in m/s 2 )?...
-
A 0.640-kg ball is dropped from rest at a point 2.70 m above the floor. The ball rebounds straight upward to a height of 1.79 m. Taking the negative direction to be downward, what is the impulse of...
-
A constant force along the positive direction x axis of magnitude 9 N acts on a body of mass 4 kg for a time of 3 s. The body moves along the x-axis with initial speed of 4 m/s. What will be the...
-
Direct labor cost $10,500 Purchases of raw materials 16,500 Factory supervisor salary 2,250 Office Supplies used 675 Factory Insurance 1,350 Commissions paid Commissions paid 2,500 Advertising 1,800...
-
Consider a transaction processing system that contains a "front-end" processor, which accepts and translate user queries arriving from a large number of terminals and formats the replies, and a...
-
The MIT Sloan School of Management is one of the leading business schools in the U.S. The following table contains the tuition data for the masters program in the Sloan School of Management. a. Use...
-
In 2018, Peugeot had a ROE of 14.4%. Its earnings per share were 3.16, and its dividends per share were 0.97. Estimate Peugeots growth rate.
-
Francesco buys 1,000 shares of Italgas at 3.5 per share, putting up a 75% margin. a. What is the debit balance in this transaction? b. How much equity funds must Francesco provide to make this margin...
-
Suppose your companys stock is currently selling at $50 per share. For each of the following situations (ignoring brokerage commissions), calculate the gain or loss that will be realized if the...
-
How does electronic commerce differ from EDI? What are the implications of these differences to the control and auditability of a company?
-
A company involved in e-commerce would expect a firewall to do all of the following except: a. Intercept traffic that meets specific criteria and send the traffic back to the originator of the...
-
To obtain evidence that user identification and password control procedures are functioning as designed, an auditor would most likely a. Attempt to sign onto the system using invalid user...
Study smarter with the SolutionInn App