Assume that Social Security promises you $30,000 per year starting when you retire 45 years from today (the first $30,000 will get paid 45 years from now). If your discount rate is 5%, compounded annually, and you plan to live for 18 years after retiring (so that you willl receive a total of 19 payments including the first one), what is the value today of Social Security's promise? The value today of Social Security's promise is $ (Round to the nearest cent.)
Assume that Social Security promises you $30,000 per year starting when you retire 45 years from today (the first $30,000 will get paid 45 years from now). If your discount rate is 5%, compounded annually, and you plan to live for 18 years after retiring (so that you willl receive a total of 19 payments including the first one), what is the value today of Social Security's promise? The value today of Social Security's promise is $ (Round to the nearest cent.)
Financial Accounting Intro Concepts Meth/Uses
14th Edition
ISBN:9781285595047
Author:Weil
Publisher:Weil
ChapterA: Appendix - Time Value Of Cash Flows: Compound Interest Concepts And Applications
Section: Chapter Questions
Problem 7Q
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