Aina just got her driver license, and she wants to buy a new car cost for RM70,000. She has RM3,000 to invest as a lump sum today. Aina is a conservative investor and she only invests in safe products. After approaching different banks, she is offered the following investment opportunities. Union Bank’s savings account with an interest rate 10.8% compounded monthly. First State Bank’s savings account with an interest rate of 11.5% compounded annually

Q: Calculate the monthly mortgage payment Alecia needs to pay for 30 years in Investment 2. 5) In…

A: In this we need to calculate the present value factor monthly to get monthly mortgage payment.

Q: Marisa Gale, a 30-year-old personal loan officer at Second National Bank, understands the importance…

A: Future value of annuity is the future worth of an series of cash flow at a certain rate of interest…

Q: n Hildebrand is trying to decide whether to invest money in a bank or in something a little riskier…

A: Interest earned by Don = A * [ (1 + i)t - 1] Where, A = Amount invested = $7,150 i = interest rate =…

Q: You are working as a personal financial adviser. Alecia, one of your clients approached you for…

A: In this we need to find out the present value factor monthly and find out monthly payment required.

Q: You are working as a personal financial adviser. Alecia, one of your clients approached you for…

A: Given, Total investment = $400,000 Savings = $100,000 1) Invested amount = $100,000 Interest = 9%…

Q: Honey wants to go to Siargao, for four days at the age of 25. She hopes to save $10,000 by the time…

A: The present value method refers to the determination of the present worth of an amount with a…

Q: Rick has an income of $100,000 that he is willing to spend over a year. If his bank account is…

A: Cash Management refers to make number and amount of withdrawals efficiently to make opportunity cost…

Q: Mary Kate, Ashley, Dakota, and Elle each want to buy a new home. Each needs to save enough to make a…

A:

Q: Baljeet, with his parents, wants to buy a local franchising hub. He found an interesting building…

A: Annuity refers to series of equalized payments that are made either at start or end of specified…

Q: Jim has an annual income of $300,000. Jim is looking to buy a house with monthly property taxes of…

A: Here, To Find: Maximum monthly mortgage payment =?

Q: You are working as a personal financial adviser. Alecia, one of your clients approached you for…

A: given, pv = $300,000 n=30 r=4% m=12

Q: A man decided to save to buy a new $30,000 car to take care of his family in his hometown.He has…

A: A. Time to be taken can be computed as follows : Calculations :

Q: After visiting several automobile dealerships, Richard selects the used car he wants. He likes its…

A: Given information: Cost of car is $10,000 Down payment of $1,500 Loan needed is $8,500 Number of…

Q: Dreya and Fred bought a $225,000 house. They made a 10% down payment and financed the rest at an APR…

A: APR: The Annual Percentage Rate (APR) is the total cost of a loan to a borrower, including fees. The…

Q: Jing, a recent engineering graduate, never took engineering economics. When she graduated, she was…

A: Effective Annual Rate is a modified rate of return where it considers the compounding effect.…

Q: Kayla Gordan plans to borrow $300,000 from ANZ bank to set up a Nail Salon.She currently has $10,000…

A: Given information, Plan to borrow from bank = $300,000  Savings = $10,000  Security for loan = house…

Q: Mr. Ahmet, who won a prize of 1 million USD by participating in a quiz show, will provide a…

A: Present Value(PV) is current value of a Future amount. It is calculated by discounting that future…

Q: Bob Fry wants to buy his grandson a Ford Taurus in 4 years. The cost of a car will be $28,000.…

A: In this we have to present value of the future value.

Q: Mike Smith just turned 16 years old. He wishes to buy a used car in one year, and he is willing to…

A: The value of money changes with time. Therefore, the time value of money considers the money…

Q: Jenny Jenks has researched the financial pros and cons of entering into a​ 1-year MBA program at her…

A: cost of MBA=$51000 Extra earnings =$21000 Period =39 years  Cost of capital =5.3%

Q: ou are working as a personal financial adviser. Alecia, one of your clients approached you for…

A: The given problem can be solved using PMT and FV function in excel. PMT function computes instalment…

Q: ie wants a new smart TV/sound system that costs $1,250. He does not have that much in cash to…

A: Hire purchase is a method of purchasing high-priced consumer items in which the buyer pays a deposit…

Q: Raya is saving for a new car. He needs to have OMR 21000 for the car in three years. How much will…

A: Given: Future value = OMR 21,000 Interest rate = 8% Years = 3

Q: You are working as a personal financial adviser. Alecia, one of your clients approached you for…

A: (1): EAR = (1+r/n)^n - 1 = (1+9%/2)^2 - 1 = 9.2025%   Now amount accumulated in Investment 1 after…

Q: Juwita buys a two-year-old Honda from a car dealer for P450,000.  She puts P150,000 down and…

A: According to the temporal worth of money notion, money is worth more now than it will be in the…

Q: Sergey is selling many townhomes in Silicon Valley. To buy one of them, every month Valentina…

A: For calculating this we have to calculate present value FACTOR from given information and from that…

Q: What is the effective interest rate

A: Effective Annual Rate is a modified rate of return where it considers the compounding effect.…

Q: Mannu is a young personal financial adviser. Molly, one of her clients approached her for…

A: a) Calculation of effective interest rate is as follows: Where, r = interest rate m = number of…

Q: 15) Ms. Day needs $20,000 to buy her dream car. In her search for the best (low cost) loan, she has…

A: To identify the bank from which Ms. Day should borrow from we need to calculate the rate per period…

Q: Cyndee wants to invest $50,000. Her financial planner advises her to invest in three types of…

A: Financial planning refers to the systematic approach adopted by individuals, group of individuals…

Q: Alice wants to be a 'wise' money saver. She has P100,000 and is willing to put it in the bank. she…

A: Simple interest is interest without compounding that is there is no interest on interest and there…

Q: How much should she invest at the end of every year in an investment fund that earns 9% annually to…

A: Time value of money (TVM) refers to the method used to measure the amount of money at different…

Q: Dave invests $3,700 in a savings account at his local bank which gives 3.296 simple annual interest.…

A: Investment means engaging your funds to generate income for the future. Interest is an income on…

Q: Deborah is planning to buy a car in 3 years. She intends to buy the best car she can for $20 000.…

A: Future Value is the accumulated amount of present value at a future date. When interest is withdrawn…

Q: Baljeet, with his parents, wants to buy a local franchising hub. He found an interesting building…

A: Ownership is the situation or actuality of possessing exclusive rights and control over property,…

Q: After visiting several automobile dealerships, Richard selects the car he wants. He likes its…

A: a) Borrowing Amount = $8,400 Add-On Interest Rate = 10%. Time Period = 2 Years   The calculation of…

Q: Deb and Rusty have just gotten married and wish to buy a home. They both work in Boston and have a…

A: A loan is a financial arrangement in which one or more people, companies, or other entities lend…

Q: Jim has an annual income of $300,000. Jim is looking to buy a house with monthly property taxes of…

A: Let the monthly mortgage = X Monthly property tax = $1200 Monthly homeowner's insurance = $300…

Q: Jacob is a 23-year-old college graduate from Sheridan College with an Honours Bachelor of Business…

A: Financial planning is an important factor to achieve financial goals and stability. The financial…

Q: As an investment advisor, you have been approached by a client called Ramesh, who wants some help in…

A: Salary = 400000 Salary expected increment per year = 12% Expected years Person R will render service…

Q: A 25-year old engineer wants to save $15,000 per year until retiring at 65. Her plan is that after 5…

A: Savings for House Saving Amount = 15,000 Savings Time Period = 5 years  Return % = 5.5%   Future…

Q: Theadre Adams wants to open an accounting firm once she gets out of college in 4 years.  She has…

A: Future value of annuity is the value of stream of recurring cashflow compounded to future date at…

Q: Compute the effective annual interest rate (EAR) Alecia would actually get in Investment 1.…

A: Effective Annual Interest Rate: It is the real rate taking into account the effects of compounding…

Q: 1. If Ahmad can buy a car today for $ 5000, the car will worth $ 10,000 in extra income to Ahmad…

A: Since money is the lifeblood of a company, it must invest as much as it can if it wants to stay in…

Q: Deb and Rusty have just gotten married and wish to buy a home. They both work in Boston and have a…

A: Let the largest amount they can use for a down payment be $ A.Cost of the house, C  = $…

Q: If Cheryl has four years until she gets her driver’s license, will she have enough to buy a used car…

A: Future value: It is the value of the sum of money in the future, compounded at a specific interest…

Q: Ishraf got his driving license one week back, and he wants to buy a new car for 12,50000Tk. He has…

A: Time value of money-It is based on the concept that money earned today is worth more than similar…

Q: Mannu is a young personal financial adviser. Molly, one of her clients approached her for…

A: Given information: Future value is $330,000 Interest rate is 7% Number of years is 15

Retirement Income

Retirement income is the income received by the retiring person after retirement. Income can either be paid every month or paid annually. The retiree would get a guaranteed income until their death. Retirement income payment differs from person to person based on their investment type and payment method. Some are paid on a lump-sum basis and some are paid in a regular series with fixed payment or variable cash flow. Retirement income can be created from retirement savings, investment, salary, bonus, and wages from employment. Every working individual should plan their retirement income according to their income goals for the future. The plan should be made by identifying suitable income sources, estimating future expenses, applying a savings plan, and managing risk and assets. The most common age for retirement is between 60-65 years.