You want to start saving for your first car which costs R300 000. You decide to save by investing in an equity index for 5years. You know that you will receive R25000 from your graduate program next year so you decide that you will invest R2500 a month into the index for 5 years. If the equity index
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- If you invest $15,000 today, how much will you have in (for further instructions on future value in Excel, see Appendix C): A. 20 years at 22% B. 12 years at 10% C. 5 years at 14% D. 2 years at 7%You want to start saving for your first car which costs R300 000. You decide to save by investing in an equity index for 5years. You know that you will receive R25000 from your graduate program next year so you decide that you will invest R2500 a month into the index for 5 years. If the equity index has a beta of 0.9, the current annual treasury bill rate is 4.15% and the JSE(ALSI) earns 9.4% annually, will you be able to afford your car at the end of your investment period?You are planning to save for retirement over the next 15 years. To do this, you will invest $1,100 a month in a stock account and $500 a month in a bond account. The return on the stock account is expected to be 8 percent, and the bond account will pay 4 percent. When you retire, you will combine your money into an account with a 5 percent return. How much can you withdraw each month during retirement assuming a 20-year withdrawal period? Group of answer choices $3,113.04 $3,324.11 $2,636.19 $3,008.21 $2,904.11
- You are planning to save for retirement over the next 30 years. To save for retirement, you will invest $1,050 a month in a stock account in real dollars and $530 a month in a bond account in real dollars. The effective annual return of the stock account is expected to be 10 percent and the bond account will earn 6 percent. When you retire, you will combine your money into an account with an effective annual return of 8 percent. The inflation rate over this period is expected to be an effective annual rate of 3 percent. How much can you withdraw each month from your account in real terms assuming a withdrawal period of 25 years? What is the nominal dollar amount of your last withdrawal?You plan to start investing into an ETF (SPY) that tracks the S&P 500 index. You will invest $907 in 3 years and $1298 in 4years. If you expect to earn a return of 9.8%, how much will you have in 13 years? Answer:You would like to know how much you need to save and invest monthly to have a $1 million in your investment account in 40 years. The current balance in the investment account is $10,000. You expect to generate an annual rate of return of 6% in a stock portfolio. $115 $447 $340 $105
- You are planning to save for retirement over the next 20 years. To do this, you will invest $700 a month in a stock account and $400 a month in a bond account. The return of the stock account is expected to be 9 percent, and the bond account will pay 6 percent. When you retire, you will combine your money into an account with a return of 8 percent. How much can you withdraw each month from your account assuming a 15-year withdrawal period? A. $623407 B. $630939 C. $635876 D. $7480888 E. $2259917You are planning on investing to save for retirement.You will invest $25,000 each year for 20 years.(the first $25,000 deposit comes in one year from today and the last $25,000 deposit comes 20 years from today). You will invest in a portfolio with a Beta of 1.8. You expect that the stock market will return 9.5% per year and the risk free will be 3% per year. How much money do you expect you will have at the end of the 20 years?You are planning to save for retirement over the next 30 years. To save for retirement, you will invest $1,700 per month in a stock account in real dollars and $595 per month in a bond account in real dollars. The effective annual return of the stock account is expected to be 12 percent, and the bond account will earn 8 percent. When you retire, you will combine your money into an account with an effective return of 9 percent. The returns are stated in nominal terms. The inflation rate over this period is expected to be 4 percent. a. How much can you withdraw each month from your account in real terms assuming a 25-year withdrawal period? b. What is the nominal dollar amount of your last withdrawal?
- You are planning to save for retirement over the next 35 years. To do this, you will invest $700 a month in a stock account and $350 a month in a bond account. The return of the stock account is expected to be 13.0 percent, and the bond account will pay 6.0 percent. When you retire, you will combine your money into an account with an 11 percent return. How much can you withdraw each month from your account, assuming a 30-year withdrawal period? (Do not round intermediate calculations. Round the answer to 2 decimal places. Omit $ sign in your response.)You are planning to save for retirement over the next 15 years. To do this, you will invest $1,100 a month in a stock account and $500 a month in a bond account. The return on the stock account is expected to be 7 percent, and the bond account will pay 4 percent. When you retire, you will combine your money into an account with a 5 percent return. How much can you withdraw each month during retirement assuming a 20-year withdrawal period?If we were to invest $10,000 in an S&P 500 index fund, pay 0.2% annual fees,and add $100 a month to it for 40 years, receiving 10.4% annual returns, what, theoretically. would happen to our investment with 3.43% annual inflation? What would it be worth in terms of today's dollars? That's 10.4% - 0.2% - 3.43% = 6.77% over 40 years.