College Retirement Equities Fund (CREF) is a pension fund that has billions of dollars invested in the stock market. Fund participants voted a few years ago on a proposal that would have placed strict limits on the amount of compensation paid to CREF executives. Why do you think 75 percent of the participants voted against the proposal?
Q: My spouse and I are each 62 and hope to retire in three years. After retirement we will receive…
A:
Q: Bud Lime has $368,882 accumulated in a retirement account. The fund is earning a low, but safe, 3%…
A: An annuity seems to be a set of payments that are made at regular periods. Regular contributions to…
Q: Jimmie has a job at an advertising agency earning $54,000 per year. Jimmie is currently 26 years old…
A: amount of corpus needed at retirement = 75,000/0.065 (interest/interest rate) amount of corpus…
Q: Bob and Rose are both 62 years old and plan to retire in 3 years. They will receive $5,000 per month…
A: Here, To Find: How many years the invested money will last to meet the additional expenses after…
Q: Bylo Selhi wants to know how many years it will take for his mutual fundinvestment of $50,000 to…
A: INTEREST RATE 12% PMT 0 PRESENT VALUE 50000 FUTURE VALUE 500000
Q: Can I please get the solution by using excel
A: The computation of the total cash outflow as follows: The formula used for the computation of the…
Q: Daniel Jackson is 30 years and wants to retire when he is 65. So far he has saved (1) $6,730 in an…
A: (1) Balance in IRA account=$6,730 Interest rate in IRA account=0.083 (2) Balance in money market…
Q: ptonite is a telecommunications provider located in Iowa with hundreds of thousands of employees.…
A: Since the top executives are all in their 50s and 60s, the Defined Benefit (DB) Pension Plan is a…
Q: Bill Petty, 56, just retired after 31 years of teaching. He is a husband and father of two children…
A: “Hi There, thanks for posting the question. But as per Q&A guidelines, we must answer the first…
Q: My spouse and I are each 62 and hope to retire in 3 years. After retirement we will receive $5,000…
A: Here,
Q: What is the least-risky asset for each of the following investors?a. A person investing for her…
A: The least-risky asset for each of the given investors are as follows:
Q: A manager just retired at age 62, with his retirement savings of $800,000 invested in a portfolio of…
A: An Annuity is a series of payments of fixed amounts and at fixed intervals. These can be of two…
Q: Examine each of the following portfolios and decide which of the three would be the best choice to…
A: Considering all the above three portfolios with parameters on Risk tolerance Inflation protection…
Q: Five years ago, you invested in the Future Investco Mutual Fund by purchasing 1,100shares of the…
A: Solution:- Compound rate of return means the annual rate of return earned. We know, amount at…
Q: A consultant advises that a fund pays out $100,000 at the end of 5 years. Provided $12,000 is…
A: Annuity due are those payments that are made at the beginning of the year and ordinary annuities are…
Q: You purchase 100 shares of a no-load mutual fund for $100 per share and sold the shares for $120 per…
A: Percentage return on the investment is the rate of return on the investment. Following is the…
Q: During an interview with her investment adviser, a retired investor made the following two…
A: The study that is performed to test the influence of psychology on the investors or financial…
Q: A 22-year-old engineering graduate wants to accumulate $2,000,000 to be available when she retires…
A: Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…
Q: A pensioner is expecting a lump sum of GHC 200,000 when she goes on pension next year and is…
A: The evaluations of the investment funds and the securities in an important technique of portfolio…
Q: Dear Financial Adviser, My spouse and I are each 62 and hope to retire in three years. After…
A: A financial advisor is an individual who provides guidance and assistance to their clients on…
Q: Alexa plans to invest $50,000 in a mutual fund that requires either a 4% front-end load or a 4%…
A: Mutual Fund Mutual funds refer to the type of investment that invests money in different risky as…
Q: defined benefit pension plan expects to pay out $23 million per year over the next 27 years to…
A:
Q: A 25-year-old engineer earning $65,000 per year wants to retire at age 55 with $2 million, and plans…
A: Since the annual interest rate is not given then we solve the problem by assuming the interest rate…
Q: Steve, a super salesman contemplating retirement on his fifty-fifth birthday, decides to create a…
A: Solution: Required balance in fund on June 30, 2020 = $217,061.23 Interest rate = 9% Time period = 4…
Q: The company’s pension plan is managed by Castle Fund Managers, a leading provider of pension…
A: Asset allocation means structuring a portfolio using the available asset classes by deciding their…
Q: 6. The process of selecting a mutual fund Jim, a 55-year-old lawyer, recently received $200,000 from…
A: The question asks to complete the statement with appropriate words by which the process of selecting…
Q: anie The State of Contusion wants to change the current retirement policy for state employees. To do…
A: The present value of the cash flow is the current worth of a cash flow at a certain rate of interest…
Q: Sarah Mix is a single 30-year-old business owner who has $500 a month toinvest. This money is in…
A: solution:- a. The age of the investor is critically important when considering equity related…
Q: 1. Explain in general how equity , preference shares , government bonds, debentures , mutual fund…
A: As per Bartleby Answering guidelines we are supposed to answer only the first 3 sub parts of the…
Q: Steve, a super salesman contemplating retirement on his fifty-fifth birthday, decides to create a…
A: Steve will withdraw $67,000 per year for four year from June 2021 to 2024 Present value of annuity…
Q: N. Ebriate, a college student at a party university, decides to forego beerdrinking and invest the…
A: A theory that helps to compute the present or future value of the cash flows is term as the TVM…
Q: Two years ago, Lizzy Martinez, from Atlanta, GA, invested $1,000 by buying 125 shares (8$ per share…
A: The income tax has to be paid on the amount of difference between the sale amount of shares and the…
Q: Chris Silvers Is 39 years old and has accumulated $128,000 In his self-directed defined contribution…
A: Since you have posted multiple questions, we will answer the first one for you. If you want a…
Q: A year and half ago, Max purchased 5,000 shares in a mutual fund called Epic Inc. for $15.75/share.…
A: The back end charge or deferred sales charges is a fee paid on the selling of shares before…
Q: The AMD investment company has advertised a new Mutual Fund that has advertised to pay 10 %…
A: Actual Rate: It is the return (gain or loss) made on an investment or portfolio of an investor.…
Q: mployee decided to invest in a trust fund which gives an interest rate of 2% compounded quarterly.…
A: The present worth of fund is the equivalent value of fund today considering time and interest rate…
Q: A consultant advises that a fund pays out $100,000 at the end of 5 years. Provided $12,000 is…
A: $100000 is the future value of annuity due, with $12000 (A) as the annual deposit. n = 5 years Let r…
Q: Bob and Rose are both 62 years old and plan to retire in 3 years. They will receive $5,000 per month…
A: Present Value- Present value define as the present-day cost or value of the forthcoming sum of money…
Q: "As of today, Americans live on average 20 more years after retiring, which calls for well-designed…
A:
Q: utions every year with a 401(K) where the employees will bear the investment risk. The majority of…
A: Kryptonite is a telecommunications company providing retirement plans to hundreds of thousands of…
Q: Bill Petty, 56, just retired after 31 years of teaching. He is a husband and father of two children…
A: Note: I am providing the solution to the first question please repost the remaining questions…
Q: Kevin is 25 years old and just finished taking a Personal Finance class. He wants to start a…
A: 7a) Future value needed (F) = $1000000 Years to accumulate (n) = 30 r = 12% per annum Let the one…
Q: Two years ago, Lizzy Martinez, from Atlanta, GA, invested $1,000 by buying 125 shares (8$ per share…
A: The average costs of shares can be computed by using the total amount of investment in shares made…
College Retirement Equities Fund (CREF) is a pension fund that has billions of dollars invested in the stock market. Fund participants voted a few years ago on a proposal that would have placed strict limits on the amount of compensation paid to CREF executives. Why do you think 75 percent of the participants voted against the proposal?
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- A pensioner is expecting a lump sum of GHC 200,000 when she goes on pension next year and is thinking of the best way to allocate the funds to be received. An investment analyst has introduced her to a four funds as follows: Gamma Fund: This specializes in money market instruments and bonds of large corporations Delta Fund: This specializes in equities of exchange listed financial institutions Beta Fund: This specializes in bonds and equities of all good performing companies Index Fund: This is a portfolio that mimics the Ghana Stock Exchange All Share Index The investment analyst gathered information about the performance of the four funds and this is presented below: Funds Mean Return Standard Deviation Beta Co-efficient Gamma 15% 8% 0.25 Delta 20% 14% 1.20 Beta 18% 14% 0.85 Index 17% 12% 1.00 The rate on Government of Ghana five-year bond which is used as the standard risk-free rate is 8% per annum. The…A pension fund manager decides to invest a total of at most $30 million in U.S. Treasury bonds paying 4% annual interest and in mutual funds paying 8% annual interest. The fund manager plans to invest at least $5 million in bonds and at least $10 million in mutual funds. Bonds have an initial fee of $100 per million dollars, while the fee for mutual funds is $200 per million. The fund manager is allowed to spend no more than $5000 on fees. How much should be invested in each to maximize annual interest? What is the maximum annual interest?A pension fund manager decides to invest a total of at most $35 million in U.S. Treasury bonds paying 3% annual interest and in mutual funds paying 5% annual interest. He plans to invest at least $ 5 million in bonds and at least $10 million in mutual funds. Bonds have an initial fee of $100 per million dollars, while the fee for mutual funds is $200 per million The fund manager is allowed to spend no more than $6000 on fees. How much should be invested in each to maximize annual interest? What is the maximum annual interest? The amount that should be invested in Treasury bonds is $_ million and the amount that should be invested in mutual funds is $_ million
- Your younger brother is very concerned about investment performance, but he is willing to tolerate some risk. He decides to invest $100,000 in a mutual fund that will earn 10% per year. The proceeds will be accumulated as a lump sum and paid out at the end of year 10. Based on the data given below under Note. what is today’s purchasing power equivalent of your younger brother’s investment? Note: Your older brother is concerned more about investment safety than about investment performance. For example, he has invested $100,000 in safe 10-year corporate AAA bonds yielding an average of 6% per year, payable each year. His effective income tax rate is 33%, and inflation will average 3% per year.Bob's Burger Buns, Inc. is installing a brand new defined benefit pension plan. Bob is age 55 and will retire at age 65. The next oldest employee is age 35 and will retire in 30 years. Bob has a low risk tolerance. The average tenure of the rank-and-file employees is three years. Examine each of the following portfolios and decide which of the three would be the best choice to fund the plan. Justify your response in terms of the owner's risk tolerance level, inflation protection level, UBTI concerns, and compliance with ERISA diversification requirements: Portfolio 1: 70% invested in U.S. government Treasury securities with various maturities; 20% invested in a municipal bond fund; and 10% invested in a money market fund invested un U.S> Treasury bills. Portfolio 2: 40% invested in an aggressive growth mutual fund; 20% invested in certificates of deposit; 20% invested in financial futures; and 20% invested in a gold and other precious metals mutual fund. Portfolio 3: 40%…The manager responsible for the pension fund of Ruthin plc has to present a report to the Board of Directors on the financial position of the fund. He decides to use the position of the typical employee to illustrate the fund’s position. There is £30,000 currently held in the fund for each employee. The typical employee has 15 years to go to retirement and the company’s actuary has proposed that the company should anticipate having to fund pension payments over a retirement period of 12 years for the average employee. The average pension payment per annum is expected to be £12,000 and the rate of return expected on the pension funds investment is expected to be 6 per cent. The manager needs to determine the constant annual sum that the company needs to put into the pension fund for each of the next 15 years to be able to meet the fund’s obligations. Determine this annual sum. (Assume all payments into the fund and all pension payments are made at the end of each year.)
- A man would like to invest $50,000 in government bonds and stocks that will give an overall annual return of about 5%. The money to be invested I government bonds will give an annual return of 4.5% and the stock of about 6%. The investments are in units of 100 each. If he desires to keep his stock investment to minimum order to reduce his risk, determine how many government bonds and how stocks should he purchase?You purchase 100 shares of a no-load mutual fund for $100 per share and sold the shares for $120 per share after a year. Please explain to your classmates how you would calculate the percentage return on your investment?Mr. Akbar and Ms. Arwa are both 45 years old. They have two main financial goals: saving for retirement and their children's college education , Mr. Akbar has OMR 35,000 and Ms. Arwa has OMR 40,000 . They come to you for investment advice on the basis of the following investment alternatives : - Sl No 1 2 3 4 5 Securities Equity Preference shares Government Bonds Bank deposits Debenture Mutual Fund Securities return 12.5 % 10 % 6% 4.5\% 8% 9% 6 Your analysis and investment strategy proposal should : 1. Explain in general how equity , preference shares , government bonds, debentures , mutual fund and other investment instruments are traded in financial markets . 2. Analyze investment opportunities that align with the financial goals of the Mr. Akbar and Ms. Arwa . 3. Recommend specific investments to create a portfolio from the above list of investment alternatives (at least 4 investment alternatives ). 4. Calculate Expected Return , Variance , Standard Deviation , Covariance and…
- Monat Company has grown rapidly since its founding in 2004. To instill loyalty in its employees, Monat is contemplating establishment of a defined benefit plan. Monat knows that lenders and potential investors will pay close attention to the impact of the pension plan on the company’s financial statements, particularly any gains or losses that develop in the plan. Monat has asked you to conduct some research on the accounting for gains and losses in a defined benefit plan.InstructionsIf your school has a subscription to the FASB Codification, go to http://aaahq.org/ascLogin.cfm to log in and prepare responses to the following. Provide Codification references for your responses.(a) Briefly describe how pension gains and losses are accounted for.(b) Explain the rationale behind the accounting method described in part (a).(c) What is the related pension asset or liability that will show up on the balance sheet? When will each of these situations occur?A defined benefit pension plan expects to pay out $23 million per year over the next 27 years to pensioners. The fund currently has $176 million in pension assets that are earning 8.2% per year. By how much is this plan over/under funded? (Do not round intermediate calculations. Round your answer to a whole number. Use a negative sign to denote underfunded)Dear Financial Adviser, My spouse and I are each 62 and hope to retire in 3 years. After retirement we will receive $5,000 per month after taxes from our employers’ pension plans and $1,000 per month after taxes from Social Security. Unfortunately our monthly living expenses are $15,000. Our social obligations preclude further economies. We have $1,200,000 invested in a high-grade, municipal-bond mutual fund. However, the fund's annual after-tax return has dropped to 3.5%. We plan to make annual withdrawals from the mutual fund to cover the difference between our pension and Social Security income and our living expenses. How long will our money last? Sincerely, Luxury Challenged Marblehead, MA You can assume that the withdrawals (one per year) will sit in a checking account (no interest) until spent. The couple will use the account to cover the monthly shortfalls. How many years before Luxury Challenged runs out of money? (Do not round intermediate calculations. Round your answer to 2…