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4. Now with $150,000 bonus that will be saved today, Michelle will then make 4 additional...

4. Now with $150,000 bonus that will be saved today, Michelle will then make 4 additional equal payments each year from 2019 to 2022 to end up with $150,000 at the end of 2022. If Citi Bank still pays 3.5% interest annual, how large must each payment be?

5. Assume after 5 years, Michelle will be 40 years old and will have $200,000 in her saving account, and she is planning to retire at 65 years old and she will need $1,200,000 at retirement. What annual interest rate must she earn to reach her goal, assuming each year she will only save $20,000.

Solutions

Expert Solution

IT IS considered that saving is done at the end of the year.

jeff jeffy answered 4 days ago
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