Question
In: Finance
You invest $35,000 today and $3800 per year for 30 years. Assuming you earn an 8.4%...
- You invest $35,000 today and $3800 per year for 30 years. Assuming you earn an 8.4% rate of return, how much will you have at the end of the 30th year? How much more do you have after 40 years? Of that additional money, how much came from your contributions and how much from investment income?
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Expert Solution
rate positively ..
| Ans 1 | |||||||
| we have to use financial calculator to solve this | |||||||
| put in calculator | |||||||
| PV | -35,000 | ||||||
| PMT | -3800 | ||||||
| I | 8.40% | ||||||
| N | 30 | ||||||
| Compute FV | $856,871.03 | ||||||
| Therefore future value after 30 year = | $856,871.03 | ||||||
| Ans 2 | |||||||
| we have to use financial calculator to solve this | |||||||
| put in calculator | |||||||
| PV | -856,871 | ||||||
| PMT | 0 | ||||||
| I | 8.40% | ||||||
| N | 10 | ||||||
| Compute FV | $1,919,589.13 | ||||||
| Therefore future value after 40 year = | $1,919,589.13 | ||||||
| Therefore additional amount= | $1,062,718.10 | ||||||
| Ans 3 | |||||||
| how much came from your contributions and how much from investment income? | |||||||
| 30 year | 40 year | ||||||
| Future value | $ 856,871.03 | $ 1,919,589.13 | |||||
| Contribution | $ 149,000.00 | $ 149,000.00 | |||||
| Investment income | $ 707,871.03 | $ 1,770,589.13 | |||||
jeff jeffy answered 2 years agoRelated Solutions
You invest $35,000 today and $3800 per year for 30 years. Assuming you earn an 8.4%...
You invest $35,000 today and $3800 per year for 30 years.
Assuming you earn an 8.4% rate of return, how much will you have at
the end of the 30th year? How much more do you have
after 40 years? Of that additional money, how much came from your
contributions and how much from investment income?
If you invest $10,000 today and earn 7% per year, how much total interest will you...
If you invest $10,000 today and earn 7% per year, how much total
interest will you make in 20 years? How much is simple interest and
how much is due to compounding?
You save $75 a month for 30 years. If you are able to earn 6%per...
You save $75 a month for 30 years. If you are able to earn 6%
per year on your savings, how much will you have accumulated by the
end of 30 years?Assume monthly compounding.
Assume you can earn 8.3% per year on your investments. a. If you invest $190,000 for...
Assume you can earn 8.3% per year on your investments.
a. If you invest $190,000 for retirement at age 30, how much
will you have 35 years later for retirement?
b. If you wait until age 40 to invest the $190,000, how much
will you have 25 years later for retirement?
c. Why is the difference so large?
(Round to the nearest dollar.)
Suppose you are going to receive $ 35,000 per year for 18 years at the beginning...
Suppose you are going to receive $ 35,000 per year for 18 years
at the beginning of each year. Compute the present value of the
cash flows if the appropriate interest rate is 14 percent. Round it
two decimal places, and do not include the $ sign, e.g.,
123456.78.
Assume you are planning to invest $5,558 each year for six years and will earn 7...
Assume you are planning to invest $5,558 each year for six years
and will earn 7 percent per year. Determine the future value of
this annuity due problem if your first $5,558 is invested now.
(Round answer to 2 decimal places, e.g.,
1,220.25.)
Assume you can earn 9% per year on your investments. If you invest $100,000 for retirement...
Assume you can earn 9% per year on your investments.
If you invest $100,000 for retirement at age 30, how much will
you have 35 years later for retirement? (Answer:
$2,041,397)
If you wait until age 40 to invest the $100,000, how much will
you have 25 years later for retirement? (Answer:
$862,308)
Why is the difference so large?
Upon graduating from college this year, you expect to earn $25,000 per year. If you get your MBA, in one year you can expect to start at $35,000 per year.
Upon graduating from college this year, you expect to earn $25,000 per year. If you get your MBA, in one year you can expect to start at $35,000 per year. Over the year, inflation is expected to be 5 percent. In today's dollars, how much additional (less) money will you make from getting your MBA (to the nearest dollar) in your first year?
You invest $1,190,000 into a retirement account and earn 9.00% per year, compounded monthly. At retirement...
You invest $1,190,000 into a retirement account and earn 9.00%
per year, compounded monthly. At retirement your account balance is
$5,430,000. Over how many years did you make this investment?
PLEASE ANSWER WITH EXCEL
Sally Medavoy will invest $6,740 a year for 23 years in a fund that will earn...
Sally Medavoy will invest $6,740 a year for 23 years in a fund
that will earn 5% annual interest. If the first payment into the
fund occurs today, what amount will be in the fund in 23 years? If
the first payment occurs at year-end, what amount will be in the
fund in 23 years? (Round factor values to 5 decimal places, e.g.
1.25124 and final answers to 0 decimal places, e.g. 458,581.)
First payment today $ ?
First payment...
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