You believe you will spend $40,000 a year for 20 years once you retire in 40 years.
Question:
You believe you will spend $40,000 a year for 20 years once you retire in 40 years. If the interest rate is 6% per year, how much must you save each year until retirement to meet your retirement goal?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 42% (7 reviews)
By the time you retire you will need PV The future value of the ...View the full answer
Answered By
Bhartendu Goyal
Professional, Experienced, and Expert tutor who will provide speedy and to-the-point solutions. I have been teaching students for 5 years now in different subjects and it's truly been one of the most rewarding experiences of my life. I have also done one-to-one tutoring with 100+ students and help them achieve great subject knowledge. I have expertise in computer subjects like C++, C, Java, and Python programming and other computer Science related fields. Many of my student's parents message me that your lessons improved their children's grades and this is the best only thing you want as a tea...
3.00+
2+ Reviews
10+ Question Solved
Related Book For
Fundamentals of Corporate Finance
ISBN: 978-0077861629
8th edition
Authors: Richard Brealey, Stewart Myers, Alan Marcus
Question Posted:
Students also viewed these Corporate Finance questions
-
You believe you will spend $40,000 per year for 20 years once you retire in 40 years. If the interest rate is 5% per year, how much must you save each year until retirement to meet your retirement...
-
You believe you will need to have saved $500,000 by the time you retire in 40 years in order to live comfortably. You also believe that you will inherit $100,000 in 10 years. If the interest rate is...
-
You believe you will need to have saved $500,000 by the time you retire in 40 years in order to live comfortably. If the interest rate is 6% per year, how much must you save each year to meet your...
-
Use the test of your choice to determine whether the following series converge. + + +
-
Hervis Rent-A-Car has three car rental locations in the greater Houston area: the Northside branch, the West End branch, and the Suburban branch. Customers can rent a car at any of these places and...
-
An analyst for FoodMax estimates that the demand for its Brand X potato chips is given by ln Qdx = 12.14 2.8 ln PX + 3.4PY + 0.7 ln AX, where QX and PX are the respective quantity and price of a...
-
In a Pew Research Center poll, 1007 adults were called after their telephone numbers were randomly generated by a computer, and 85% of the respondents were able to correctly identify what Twitter is....
-
It is now January. The current interest rate is 5%. The June futures price for gold is $946.30, whereas the December futures price is $960.00. Is there an arbitrage opportunity here? If so, how would...
-
1. Insulating glass (IG), more commonly known as double glazing (or double-pane, and increasingly triple glazing/pane), consists of two or three glass window panes separated by a vacuum or gas filled...
-
You manage Walnut Customer Call Center, a small business that provides call- center services under contract with various firms. Your staff of 12 employees has enjoyed a dress code that is very...
-
A couple will retire in 50 years; they plan to spend about $30,000 a year in retirement, which should last about 25 years. They believe that they can earn 8% interest on retirement savings. a. If...
-
A couple thinking about retirement decide to put aside $3,000 each year in a savings plan that earns 8% interest. In 5 years they will receive a gift of $10,000 that also can be invested. a. How much...
-
Assume Saudi Arabia and the United States face the production possibilities for oil and cars shown in the accompanying table. a. What is the opportunity cost of producing a car in Saudi Arabia? In...
-
As a manager with years of experience in negotiations, you were involved in many different types of conflicts. There was one case where a worker argued he should be allowed to smoke his (legally...
-
The Outrigger Hotels and Resorts Case starting Piccoli. As you read the case, think about the situation from a technology perspective (e.g., how are they using technology, what are the stumbling...
-
To increase customer retention, your company prepares to launch an improvement project. One of the objectives is to improve the internal processes of the customer service department. In this regard,...
-
A. Consider the equipment listed below and determine if it will be needed for moving materials on a construction site. Provide a brief reason why or why not it is needed? 1) Backhoe 2) Bulldozer 3)...
-
You have recently contacted a company called Antrax Hardware. They have put you in touch with the general sales manager. During your interview with her, she tells you of a problem she is facing, "Our...
-
Which of the following statements does not follow from the fact that the alkali metals have relatively weak metalmetal bonding? (a) The alkali metals are less dense than other metals. (b) The alkali...
-
4. Jobe dy -Y 2 et by
-
Using Table 3.7, calculate the combined federal and provincial marginal and average tax rates for both an Albertan and Newfoundlander with the following incomes: a. $20,000 b. $60,000 c. $ 100,000 d....
-
John Flynn lives in Nova Scotia. In 2014 he earned $1,500 in interest income and $3,000 in dividend income, and realized a $2,000 capital gain. Calculate his after-tax income and tax rate for each...
-
On the Brandex Inc. SFP as the year-end 2013 the share capital was $1,100,000, retained earnings were $3,000,000, accumulated other comprehensive income was $400,000, and total equity was $4,500,000....
-
Cash 1,500 Accounts Receivable 2,000 Interest Receivable 100 Prepaid Insurance 1,600 Notes Receivable (long-term) 2,800 Equipment 15,000 Accumulated Depreciation 3,000 Accounts Payable 2,400 Accrued...
-
The ABC company needs a 2 year equipment. The equipment has zero salvage value and zero book value after 2 years. ABC's tax rate is 40%. ABC plans to lease the equipment under a guideline lease for 2...
-
Suppose your friend tells you that she recently purchased a 15-year $3,000.00 bond with a 5% coupon. A month later, she saw it quoted at 109:4, but she does not know what this means. You can tell by...
Study smarter with the SolutionInn App