Question

Derek decides that he needs $101,702.00 per year in retirement to cover his living expenses. Therefore, he wants to withdraw $101702.0 on each birthday from his 66th to his 85.00th. How much will he need in his retirement account on his 65th birthday? Assume a interest rate of 10.00%.

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Answer format: Currency: Round to: 2 decimal places.

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#2

Derek plans to retire on his 65th birthday. However, he plans to work part-time until he turns 74.00. During these years of part-time work, he will neither make deposits to nor take withdrawals from his retirement account. Exactly one year after the day he turns 74.0 when he fully retires, he will wants to have $3,480,498.00 in his retirement account. He he will make contributions to his retirement account from his 26th birthday to his 65th birthday. To reach his goal, what must the contributions be? Assume a 8.00% interest rate.

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#3

Derek plans to retire on his 65th birthday. However, he plans to work part-time until he turns 70.00. During these years of part-time work, he will neither make deposits to nor take withdrawals from his retirement account. Exactly one year after the day he turns 70.0 when he fully retires, he will begin to make annual withdrawals of $125,076.00 from his retirement account until he turns 85.00. He he will make contributions to his retirement account from his 26th birthday to his 65th birthday. To reach his goal, what must the contributions be? Assume a 7.00% interest rate.

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Answer format: Currency: Round to: 2 decimal places.

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#4

Derek plans to retire on his 65th birthday. However, he plans to work part-time until he turns 72.00. During these years of part-time work, he will neither make deposits to nor take withdrawals from his retirement account. Exactly one year after the day he turns 72.0 when he fully retires, he will begin to make annual withdrawals of $166,805.00 from his retirement account until he turns 88.00. After this final withdrawal, he wants $1.55 million remaining in his account. He he will make contributions to his retirement account from his 26th birthday to his 65th birthday. To reach his goal, what must the contributions be? Assume a 5.00% interest rate.

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Answer format: Currency: Round to: 2 decimal places.

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#5

A bank offers 8.00% on savings accounts. What is the effective annual rate if interest is compounded semi-annually?

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Answer format: Percentage Round to: 4 decimal places (Example: 9.2434%, % sign required. Will accept decimal format rounded to 6 decimal places (ex: 0.092434))

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#6

Derek has the opportunity to buy a money machine today. The money machine will pay Derek $34,503.00 exactly 3.00 years from today. Assuming that Derek believes the appropriate discount rate is 5.00%, how much is he willing to pay for this money machine?

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#7

Assume the nominal rate of return is 6.42% and the inflation rate is 1.53%. Find the real rate of return using the exact formula.

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Answer format: Percentage Round to: 0 decimal places (Example: 9%, % sign required. Will accept decimal format rounded to 2 decimal places (ex: 0.09))

Answer 1