Question

Alan Hitchcock is 37 years old today and he wishes to accumulate
$519,000 by his 57 th birthday so he can retire to his summer place
on Lake Hopatcong. He wishes to accumulate this amount by making
equal deposits on his 37 th through his 56 th birthdays. What
annual deposit must Alan make if the fund will earn 8% interest
compounded annually? **(Round factor values to 5 decimal
places, e.g. 1.25124 and final answer to 0 decimal places, e.g.
458,581.)**

Answer #1

Based on the information available in the question, we can answer as follows:-

Future Value = Annual Investments * FVIFA(8%, 20 years)

Since Alan Hitchcock makes his first investment when he is 37 years old itself, we will be using the Future Value of Annuity dude to calculate the required annual investments. Hence, we will be finding the FVIFA value for 19 years and then adding 1 to it , to arrive at the correct answer.

Let annual investments be "x"

$519,000 = x * 42.44626

x = $519,000/42.44626

x = $12,227.2256

**Annual Investments to be made by Alan = $12,227.23
(Rounded)**

Please let me know if you have any questions via comments and all the best.

Newman Hitchcock is 38 years old today and he wishes to
accumulate $501,000 by his 61st birthday so he can retire to his
summer place on Lake Hopatcong. He wishes to accumulate this amount
by making equal deposits on his 38th through his 60th birthdays.
What annual deposit must Newman make if the fund will earn 8%
interest compounded annually? (Round factor values to 5
decimal places, e.g. 1.25124 and final answer to 0 decimal places,
e.g. 458,581.)

Daryl wishes to save money to provide for his retirement. He is
now 30 years old and will be retiring at age 64. Beginning one
month from now, he will begin depositing a fixed amount into a
retirement savings account that will earn 12% compounded monthly.
Then one year after making his final deposit, he will withdraw
$100,000 annually for 25 years. In addition, and after he passes
away (assuming he lives 25 years after retirement) he wishes to
leave...

Daryl wishes to save money to provide for his retirement. He is
now 30 years old and will be retiring at age 64. Beginning one
month from now, he will begin depositing a fixed amount into a
retirement savings account that will earn 12% compounded monthly.
Then one year after making his final deposit, he will withdraw
$100,000 annually for 25 years. In addition, and after he passes
away (assuming he lives 25 years after retirement) he wishes to
leave...

Stellar Inc. loans money to John Kruk Corporation in the amount
of $800,000. Stellar accepts an 8% note due in 7 years with
interest payable semiannually. After 2 years (and receipt of
interest for 2 years), Stellarneeds money and therefore sells the
note to Chicago National Bank, which demands interest on the note
of 10% compounded semiannually. What is the amount Stellar will
receive on the sale of the note? (Round factor values
to 5 decimal places, e.g. 1.25124 and...

Problem
Daryl wishes to save money to provide for his retirement. He is
now 30 years old and will be retiring at age 64. Beginning one
month from now, he will begin depositing a fixed amount into a
retirement savings account that will earn 12% compounded monthly.
Then one year after making his final deposit, he will withdraw
$100,000 annually for 25 years. In addition, and after he passes
away (assuming he lives 25 years after retirement) he wishes to...

You just turned 18 years old today and decided you want to
accumulate $6,000,000 for retirement. You figure you can start
making weekly deposits into a mutual fund that promises to pay an
average yield of 12% per year. You intend to make the first deposit
at the end of this week and retire exactly on the day of your
67th birthday. How much money should you deposit weekly
in the mutual fund to meet your goal?

Starling wants to retire with $2,010,000 in his retirement
account exactly 31 years from today. He will make annual deposits
at the end of each year to fund his retirement account. If he can
earn 9.33 percent per year, how much must he deposit each year?

1- Serena Willis will invest $27,700 today. She needs $42,972 in
9 years.
What annual interest rate must she earn?
2- Gary Bautista needs $27,000 in 3 years.
What amount must he invest today if his investment earns 12%
compounded annually? What amount must he invest if his investment
earns 12% annual interest compounded quarterly? (Round
factor values to 5 decimal places, e.g. 1.25124 and final answers
to 0 decimal places, e.g. 458,581.)
Investment at 12% annual interest, compounded quarterly...

Derek plans to retire on his 65th birthday. However, he plans to
work part-time until he turns 73.00. 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 73.0 when he fully retires, he will wants to have
$3,423,684.00 in his retirement account. He he will make
contributions to his retirement account from his 26th birthday to
his 65th birthday. To reach his...

A man is planning to retire in 20 years. He wishes to deposit a
regular amount every three months until he retires, so that,
beginning one year following his retirement, he will receive annual
payments of $60,000 for the next 15 years. How much must he
deposits if the annual interest rate is 6% compounded quarterly?
(Note that the last deposit is made on the date of the end of 20th
year, and first withdrawal is at the end of...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 3 minutes ago

asked 11 minutes ago

asked 20 minutes ago

asked 25 minutes ago

asked 26 minutes ago

asked 38 minutes ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago