Question

After graduation, you plan to work for Rocket Corporation for 13 years and then start your own business. You expect to save and deposit $7,000 a year for the first 6 years (t = 1 through t = 6) and $12,500 annually for the following 7 years (t = 7 through t = 13). The first deposit will be made a year from today. In addition, your mother just gave you a $20,00 graduation gift as an incentive to work hard which you will deposit immediately (t = 0). If the account earns 6.5% compounded annually, how much will you have when you start your business 13 years from now?

Answer #1

Cashflows happenning at the end of the year.

Year0=20000*(1+6.5%)^13=45349.75

Year1=7000*(1+6.5%)^12=14903.67 and so on.....

Year12=12500*(1+6.5%)=13312.50

Year13=12500=12500

Add all these values to find Future value=$228,724.19

[email protected]% | ||

Year0 | 20000 | 45349.75 |

Year1 | 7000 | 14903.67 |

Year2 | 7000 | 13994.06 |

Year3 | 7000 | 13139.96 |

Year4 | 7000 | 12337.99 |

Year5 | 7000 | 11584.97 |

Year6 | 7000 | 10877.91 |

Year7 | 12500 | 18239.28 |

Year8 | 12500 | 17126.08 |

Year9 | 12500 | 16080.83 |

Year10 | 12500 | 15099.37 |

Year11 | 12500 | 14177.81 |

Year12 | 12500 | 13312.50 |

Year13 | 12500 | 12500.00 |

Future Value | 228724.19 |

Question 14
After graduation, you plan to work for Rocket Corporation for 13
years and then start your own business. You expect to save and
deposit $7,000 a year for the first 6 years (t = 1 through t = 6)
and $12,500 annually for the following 7 years (t = 7 through t =
13). The first deposit will be made a year from today. In addition,
your mother just gave you a $20,00 graduation gift as an incentive...

You just graduated, and you plan to work for 10 years and then
to leave for the austrailian outack bush country. You figure you
can save 1000 a year for the first 5 years and 2000 a year for the
next 5 years. These savings cash flows will start one year from
now. In addition your family has just given you a 10,000 gift. If
you put the gift now, and your future savings when they start, into
an acount...

You just graduated and you plan to work for 10 years and then to
leave for the Australian “Outback” bush country. You figure you can
save $968 a year for the first 5 years and $2,162 a year for the
next 5 years. These savings cash flows will start one year from
now. In addition, your family has just given you a $4,980
graduation gift. If you put the gift now, and your future savings,
when they start, into an...

You are
2424
years
old and decide to start saving for your retirement. You plan to
save
$ 6 comma 500$6,500
at
the end of each year (so the first deposit will be
one year from now), and will make the last deposit
when you retire at age
6767.
Suppose
you earn
11 %11%
per
year on your retirement savings.
a.
How much will you have saved for
retirement?
b.
How much will you have saved if you wait until...

You are 23 years old and decide to start saving for your
retirement. You plan to save $ 6,500 at the end of each year (so
the first deposit will be one year from now), and will make the
last deposit when you retire at age 69. Suppose you earn 12% per
year on your retirement savings.
a. How much will you have saved for retirement?
b. How much will you have saved if you wait until age 40 to...

You are 30 years old and decide to start saving for your
retirement. You plan to save $ 5000 at the end of each year (so
the first deposit will be one year from now), and will make the
last deposit when you retire at age 65 Suppose you earn 11 % per
year on your retirement savings. a. How much will you have saved
for retirement?
b. How much will you have saved if you wait until age 39...

You will need $25,000 to start your business in 7
years.
A) If you can earn 5% on an initial investment, how much will
you have to deposit today?
B) What if you want to start in 5 years, instead of 7 years?
C) What if you can earn 7% instead of 5%?

You
are 26 years old and decide to start saving for your retirement.
You plan to save $6,000 at the end of each year (so the first
deposit will be one year from now), and will make the last deposit
when you retire at age 65. Suppose you earn 6% per year on your
retirement savings, how much will you have saved for retirement
right at age 65? (Round to the nearest dollar.)

You deposit $11,000 annually into a life insurance fund for the
next 13 years, after which time you plan to retire.
a.
If the deposits are made at the beginning of the year and earn
an interest rate of 6 percent, what will be the amount in the
retirement fund at the end of year 13? (Do not round
intermediate calculations. Round your answer to 2 decimal places.
(e.g., 32.16))
Future value
$
b.
Instead of a lump sum, you...

10. You are 29 years old and decide to start saving on your
retirement. You plan to save $6,000 at the end of each year (so the
first deposit will be one year from now) and make the last deposit
when you retire at age 65. Suppose you earn 6% per year on your
retirement savings. How much will you have saved for retirement at
the age of 65?
11. A rich relative has bequeathed you with a growing
perpetuity....

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 6 minutes ago

asked 10 minutes ago

asked 14 minutes ago

asked 17 minutes ago

asked 19 minutes ago

asked 22 minutes ago

asked 23 minutes ago

asked 29 minutes ago

asked 32 minutes ago

asked 35 minutes ago

asked 38 minutes ago

asked 42 minutes ago