You have decided that you want to be a millionaire when you retire in 44 years....

You have decided that you want to be a millionaire when you retire in 44 years.

1. .If you can earn an annual return of 11.22 percent, how much do you have to invest today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

2. .What if you can earn an annual return of 5.61 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

1. amount to invest _______

2. amount to invest _______

Expert Solution

Amount to invest = FV / (1 + r)^t

1. Amount to invest = $1,000,000 / (1 + 0.1122)^44 = $9,288.65

2. Amount to invest = $1,000,000 / (1 + 0.0561)^44 = $90,568.70

jeff jeffy answered 2 years ago

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