1. Susan has a 401k plan through her job and has accumulated $375,000 in her account....

1.	Susan has a 401k plan through her job and has accumulated $375,000 in her account. Her company has invested her funds in a high interest-bearing account yielding 8% per year. She would like to retire with $600,000 in her account. When will she be able to retire?

2.	Joe has $100,000 in an investment account. He is looking to retire in 12 years. He needs a minimum of $240,000 in order to retire. What rate of return does Joe need to make on his investment in order to be able to retire?

Congratulations, you just won the lottery!!! The award was for $40,000,000. The lottery company has offered to either pay you the entire amount over 40 years at $1,000,000 per year, or they have offered you a chunk of money today (a lump sum) instead of receiving the $1,000,000 per year for 40 years. Assuming a rate of 6%, what dollar amount does the lump sum need to be to be worth taking over the $1,000,000 per year for 40 years?

4.	Jane is contributing $5,000 each year, at the end of the year into a savings plan that is generating a 4% return. What will the account be worth in 10 years? What if Jane makes her contribution in the beginning of the year. How will that affect the value of her account in ten years?

5.	A $100,000 mortgage carries a 9% annual interest rate compounded monthly for a maximum of 30 years. How many monthly payments of $1,000 will it take to pay off the loan in full?

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ekkarill92 answered 1 year ago

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