Mike joins a savings program where he deposits $1000 at the begint he will earn a perpetuity paying $6300 per year with the first payment at the end of the 30th year. The effective interest rate is 5% for the first 20 years and 8% afterward a) Will Mike have accumulated enough to fund the perpetuity? • b) If your answer above is no, find the unique extra deposit X that Mike has to make at the end of the 28th year in order to fund the perpetuity
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- Gustav desires to deposit with a Trust Company a sum just sufficient to provide his family with an annuity of $600 per month for twenty-four years. How much he deposit if the Trust Company agrees to accumulate interest at the rate of 6% payable monthly? show solutionKevin deposits a fixed quarterly amount into an annuity account for his child's college fund. He wishes to accumulate a future value of $90,000$90,000 in 1616 years. Assuming an APR of 3.7%3.7% compounded quarterly, how much of the $90,000$90,000 will Kevin ultimately deposit in the account, and how much is interest earned? Round your answers to the nearest cent, if necessary.Walter deposits S380.89 each month into an annuity account for his child's college fund in order to accumulate a future value of $90,000 in 15 years. How much of the $90,000 will Walter ultimately deposit in the account, and how much is interest earned? Round your answers to the nearest cent, if necessary. Formulas AnswerHow to enter your annwer fopens in new window Keypad Keyboard Shortcuts Amount Walter will deposit: S ev Ne Interest earned: $
- James deposits a fixed quarterly amount into an annuity account for his child's college fund. He wishes to accumulate a future value of $60,000 in 12 years. Assuming an APR of 3.3 % compounded quarterly, how much of the $60,000 will James ultimately deposit in the account, and how much is interest earned? Round your answers to the nearest cent, if necessary. PANE Formulas KeypadSlick Sam has a special relationship with his banker. The nature of the relationship is as follows: • The bank owes Sam $100 per year forever. The 1st payment is due in 1 year. • The bank will borrow or lend money to Sam at a constant effective rate of i per year. Today, Sam calculated the present value of the payments that are due to him as X. Sam can receive his first 16 payments at the end of year 16 in a lump sum. If he does that, then the total value of the lump sum and future payments at the end of the sixteenth year is X + 2,000. Calculate X. A B с D E 3,330 3,350 3,400 3,450 3,500Willie deposits a fixed monthly amount into an annuity account for his child’s college fund. He wishes to accumulate a future value of $125,000 in 15 years. Assuming an APR of 3.5% how much money should Willie deposit monthly in order to reach his goal. How much of the $125,000 will Willie ultimately deposit in the account, and how much is interest earned?
- Mark is in discussion with you about saving for his retirement. You are to advise him on how much he should deposit annually to meet his retirement needs. Assume that he will deposit a fixed annual amount for the next 20 years into a retirement savings account, starting one year from now. Mark has a son who will be attending college and plans to make 5 withdrawals (starting one year after making his final deposit into the retirement account) of $35,000 each to pay for his annual tuition for the following 5 years. Commercial Banks will be paying 6 percent on such retirement accounts for the next 25 years. How much should Mark place in the account annually to cover his retirement needs.James deposits $768.51 each quarter into an annuity account for his child's college fund. He wishes to accumulate a future value of $65,000 in 16 years. Assuming an APR of 3.4%, how much of the $65,000 will James ultimately deposit in the account, and how much is interest earned? Round your answers to the nearest cent, if necessary. Amount James will deposit: $ Interest earned: $Your best friend Samis in discussion with you about saving for his retirement.You areto advise him on how much he should deposit annually to meet his retirement needs. Assume that he will deposit a fixed annual amount for the next 20 years into a retirement savings account, starting one year from now. Sam has a son who will be attendingcollege and plans to make 5 withdrawals(starting one year after making his final deposit into the retirement account)of$35,000eachto pay for his annual tuition forthe following 5 years. Commercial Banks will be paying 6 percent on such retirement accountsfor the next 25 years. KindlyadviseSam on how much he should place in the account annually to cover his retirement needs.
- You annually invest $1,500 in an individual retirement account (IRA) starting at the age of 25 and make the contributions for 15 years. Your twin sister does the same starting at age 40 and makes the contributions for 25 years. Both of you earn 6 percent annually on your investment. What amounts will you and your sister have at age 65? Use Appendix A and Appendix C to answer the question. Round your answers to the nearest dollar. Amount on your account: $ Amount on your sister's account: $ Who has the larger amount at age 65? Select the larger amount.7. Your best friend Sam is in discussion with you about saving for his retirement. You are to advise him on how much he should deposit annually to meet his retirement needs. Assume that he will deposit a fixed annual amount for the next 20 years into a retirement savings account, starting one year from now. Sam has a son who will be attending college and plans to make 5 withdrawals (starting one year after making his final deposit into the retirement account) of $35,000 each to pay for his annual tuition for the following 5 years. Commercial Banks will be paying 6 percent on such retirement accounts for the next 25 years. Kindly advise Sam on how much he should place in the account annually to cover his retirement needs.Jim wants to deposit an amount anually to meet his retirement needs. Assume that he will deposit a fixed annual amount for the next 20 years into a retirement savings account, starting one year from now. Mark has a son who will be attending college and plans to make 5 withdrawals (starting one year after making his final deposit into the retirement account) of $35,000 each to pay for his annual tuition for the following 5 years. Commercial Banks will be paying 6 percent on such retirement accounts for the next 25 years. How much should Mark place in the account annually to cover his retirement needs.