"Amber recently inherited $510,000, which she immediately invested in an equity indexmutual fund. If she plans to withdraw $2,000 per month from her account, what annualinterest rate must she earn in order to have $128,000 left after 43 years? (Enter your answeras a whole number with two decimal places. For example, if your answer is 14.1025%, enter14.10 as your answer)"

HerePresent value (PV) = $510,000Monthly withdrawal(PMT) =$2000Time = 43 years or 43 x 12 = 516…

Answered: "Amber recently inherited $510,000,…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Similar questions

"Christopher recently inherited $ 1,290,000, which she immediately invested in an equity index mutual fund. If she plans to withdraw $6,000 per month from her account, what annual interest rate must she earn in order to have $284, 000 left after 47 years? (Enter your answer as a whole number with two decimal places. For example, if your answer is 14.1025%, enter 14.10 as your answer)"
Paul Finley wishes to become a millionaire. His money market fund has a balance of $239,392 and has a guaranteed interest rate of 10%. How many years must Paul leave that balance in the fund in order to get his desired $1,000,000? Round answer to 0 decimal places, e.g. 45.)
Karen White, a lottery winner, will receive the following payments over the next seven years. She has been approached by an investor who will pay Karen a lump sum today for the rights to those future cash flows. If she can invest her cash flows in a fund that will earn 10.7 percent annually, how much should Karen require the investor to pay for the cash flows? (Round answer to 2 decimal places, e.g. 15.25. Do not round factor values.) 1 2 Present value of investment $ 3 4 5 6 7 $326,000 $376,000 $401,000 $426,000 $476,000 $526,000 $676,000 Year
Consider the following independent situations. a. Mike Finley wishes to become a millionaire. His money market fund has a balance of $92,296 and has a guaranteed interest rate of 10%. How many years must Mike leave that balance in the fund in order to get his desired $1,000,000? b. Assume that Sally Williams desires to accumulate $1 million in 15 years using her money market fund balance of $182,696. At what interest rate must Sally’s investment compound annually?
Juan invested $22,000 in a mutual fund 4 yr ago. Today his investment is worth $28,838. Find the effective annual rate of return on his investment over the 4-yr period. (Round your answer to two decimal places.)
Stephanie inherited $40,000. She wants to put some of the money in a certificate of deposit that pays 2.1% interest per year and the rest in a mutual fund account that pays 6.5% per year. How much should she invest in each account if she wants to earn 5.4% interest per year on the total amount?
Your grandfather is retiring at the end of next year. He would like to ensure that his heirs receive payments of $11,600 a year forever, starting when he retires. If he can earn 12.0 percent annually, how much does your grandfather need to invest to produce the desired cash flow? (Round answer to 2 decimal places e.g. 15.25.)
You have just inherited $560,000. You plan to save this money and continue to live off the money that you are earning in your current job. If you can invest at an interest rate of 5.46 percent annually, how long will it be before your inheritance is worth $1 million? (Round intermediate calculations to 5 decimal places, e.g. 2.51251 and final answer to 2 decimal places, e.g. 2,515.25.) Inheritance will be worth $1 million in years
Susan Myer had invested $2500 in an ABC bank Certificate of Deposit when she inherited trust funds from her grandmother 15 years ago. If her investment is worth $7235 today, what interest rate compounded monthly did this investment earn? Round your answer to the nearest hundredth of a percent.
Wendy has $23,000.00 invested in a bank that pays 14.25% annually. How long will it take for her funds to triple?Round your answer to two decimal places. For example, if your answer is $345.667 round as 345.67 and if your answer is .05718 or 5.718% round as 5.72. Group of answer choices
Scarlett has $22,500 available today to invest for 20 years. Scarlett desires an investment fund balance of $100,000 at that time. What interest rate (compounded annually) must Scarlett earn to reach the desired balance in 20 years? Enter the percent rounded to two digits after the decimal; enter 2.04 for 2.044% or 2.05 for 2.045%. Answer %
Dean invests 46 dollars at the end of this year into the stock market, which is expected to earn 8% per year. Dean will increase the amount he invests in the stock market by $10 per year. Assume Dean retires after 41 years. How much money are Dean's investments worth at the end of 41 years? For the sake of simplicity, assume Dean makes his last investment at the end of year 41. (note: round your answer to two decimal places; do not include spaces or dollar signs.)

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