Question

What is the matured future value of a 25 year retirement plan that is based on...

What is the matured future value of a 25 year retirement plan that is based on an interest rate of 7%, and a geometrically increasing annual payment that starts at $1000/ year and increases by 1% annually and draw the cash flow?

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Annual payment = $ 1,000

Geometric growth =.1%

Interest rate = 7%

Time = 26 years

First converting it to present value

Now convert it to future worth

After 25 years the amount in pocket = $ 69,083

Future value = $ 69,083

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
) What is the future value at the end of year 13 of a series of...
) What is the future value at the end of year 13 of a series of deposits that starts at $6,000 in year 1 and shrinks by 7% per year for 13 years (last deposit occurs at the end of year 13)? The annual interest rate is 7% compounded annually. please answer in excel
What is the Present Value of a series of seven cash flows that starts with the...
What is the Present Value of a series of seven cash flows that starts with the cash flow of $2443 in year 1, decreases by 25% each year, and continues until year 7, at a 20% annual interest rate compounded annually?
What will be the future value? (1). A lump-sum of $3000 now, in 5 years at...
What will be the future value? (1). A lump-sum of $3000 now, in 5 years at 7% compounded annually. (2). Series of payment: $3000 at the end of each year for 5 years at 7% compounded annually. (3). $1000 at the end of the first year, then increase at a rate of $100 for the following 4 years. The interest rate of 7% compounded annually. (4). $1000 at the end of the first year, then increase by 10% for the...
3. How much is the future value of a retirement plan to be obtained in December...
3. How much is the future value of a retirement plan to be obtained in December 2040 if the sum of $ 250 is contributed monthly since January 2017 and the plan returns an annual compound interest of 4.8%? Analyze your results and discuss the advantages or disadvantages of this plan.
1. What is the future value on December 31, 2022, of 6 annual cash flows of...
1. What is the future value on December 31, 2022, of 6 annual cash flows of $50,000 with the first cash flow being made on December 31, 2016, and interest at 9% compounded annually? Round your answer to two decimal places. 2.What will be the future value on December 31, 2020, of 5 annual $60,000 deposits starting on December 31, 2016, if the amounts earn 8% compounded annually? Round your answer to two decimal places. 3.What is the present value...
Find the future value of a deposit of $3500 made into a registered retirement saving plan...
Find the future value of a deposit of $3500 made into a registered retirement saving plan from May 1, 2005, to November 1, 2035, at 6.4% p.a. compounded semi-annually? Only type the numerical value
What will be the value of an investment if you put $2,000 at the end of...
What will be the value of an investment if you put $2,000 at the end of each year into a retirement plan yielding 7% annually for 25 years (ordinary annuity)? What is the future value if the payment is deposited at the beginning of each year ((annuity due)?
How does one determine the value of any asset whose value is based on expected future...
How does one determine the value of any asset whose value is based on expected future cash flow? (C)             How is the value of a bond determined? What is the value of a 10-year $1000 par value bond with a 10% annual coupon if its required rate of return is 10%? (D)
You are planning for your future needs and retirement. $100,000 10 years from today and a...
You are planning for your future needs and retirement. $100,000 10 years from today and a retirement annuity of $80,000 per year for 20 years with the first payment 20 years from today. To pay for this, you will make 3 annual payments of $x per year beginning today and 2 annual payments of $x per year with the first payment 7 years from today. With an interest rate of 8%, what is the value for x?
You are saving $2,000 a year for retirement at the end of each year and plan...
You are saving $2,000 a year for retirement at the end of each year and plan to retire in 20 years. If you are planning for a 25-year retirement, what annual payment can you expect to receive at the end of each year during your 25-year retirement if your investments are earning 10% over your entire life? $4,582 $8,426 $12,620 $13,880
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT