Question

You will make equal deposits into your retirement
account each year for 10 years starting now (i.e.,
years 0–9). If you expect to withdraw $50,000 per
year forever beginning 30 years from now, and the
funds will earn interest at 10% per year, the size of
the 10 deposits is nearest:
(a) $4239 (b) $4662
(c) $4974 (d) $5471

Expert Answer

Want to see the step-by-step answer?

Check out a sample Q&A here.

Want to see this answer and more?

Experts are waiting 24/7 to provide step-by-step solutions in as fast as 30 minutes!*

*Response times may vary by subject and question complexity. Median response time is 34 minutes for paid subscribers and may be longer for promotional offers.
Tagged in
Business
Finance

Retirement Planning

Related Finance Q&A

Find answers to questions asked by students like you.

Q: Why do changes in retained earnings occur?

A: Introduction: Retained earnings are nothing but the accumulated profits that the corporation keeps t...

Q: Why might the riskiness of cash flow from the residual value of the real estate differ from the risk...

A: It is nothing but the salvage value or scrap value of an asset. It speaks to the measure of signific...

Q: 1) Mention and describe the characteristics of traditional bonds   2) Mention and describe the chara...

A: Hi, since there are multiple questions posted, we will answer the first question. If you want any sp...

Q: b. Distinguish between time limit orders and Limit orders

A: Time limit orders are the orders when the investors place an order to sell or buy the stock at a par...

Q: Jeffery Wei received a 6-year non-subsidized student loan of $31,000 at an annual interest rate of 5...

A: Excel Spreadsheet: Excel Workings:

Q: Palencia Paints Corporation has a target capitalstructure of 35% debt and 65% common equity, with no...

A: The WACC is the overall cost of capital from all the sources of finance. The WACC is the minimum req...

Q: Solve Using the Financial Calculator

A: YEAR CASH FLOW      1  $      10,000.00 2  $      10,000.00 3  $      10,000.00 4  $      ...

Q: Describe the procedures a company followswhen it makes a distribution through dividendpayments.

A: Answer: The company follows the following procedures through the dividend payments while making dist...

Q: A highly risk-averse investor is considering adding one additional stock to a 3-stock portfolio, to ...

A: The question is based on the concept of selection of stock in portfolio as per portfolio management....

Q: What is underpricing? What is leaving money on the table?

A: Underpricing: Underpricing is a concept in a finance where a corporation, going for IPO (initial pub...

Q: Define comparative ratio analysis

A: Answer: Comparative analysis of the ratio is a method used by companies to judge the financial perfo...

Q: This is the entire question!   Just answer A,B,C (Don't worry about the numbers for A&B) and ans...

A: Click to see the answer

Q: Investors of RIL have a chance to buy RIL shares at Rs 1,257 as compared to its presentmarket price ...

A: Present value of an amount can be computed by discounting that amount. Discounting factor can be cal...

Q: Find the expected gain (or loss) for a holder of a European put option with strike price $65 to be e...

A: The calculation of expected gain is:

Q: Can a person with rational expectations expect the price of a share of google to rise by 8% in next ...

A: Yes, a person having rational expectations can have an expectation of google’s shares price to incre...

Q: Big Sky Mining Company must install $1.5 million of new machinery in its Nevada mine. It can obtain ...

A: Calculation of Cost of Owning, Cost of Leasing and NAL of Lease: Excel Spreadsheet: Excel Workings:

Q: Assume that in 2018, a copper penny struck at the Philadelphia mint in 1795 was sold for $375,000. ...

A: Computation:

Q: How much money should be invested in an account that earns 6% interest, compounded monthly, in order...

A: COMPOUNDING MONTHLY INTEREST RATE (6%/12) 0.50% YEARS OR PERIOD (5*12) 60 PMT 0 FUTURE VALUE...

Q: Mel's Furniture received an invoice dated September 27 for 5 bedroom sets at $3,000 each. The invoic...

A: The net payment made by the buyer to the seller is the invoice amount after reducing all the returns...

Q: 1. what is the amount of the unrealised profit to be eliminated if the parente year end inventory in...

A: Click to see the answer

Q: Sorry this is a long question, this is all part of this question... The process of bond valuation is...

A: Hi, since there are multiple questions posted, we will answer the first three sub-part questions. If...

Q: How can the WACC be both an average cost and a marginal cost?

A: Weighted average cost of capital is the aggregated cost of capital with respect to the weights or pr...

Q: Assume the total cost of a college education will be $340,000 when your child enters college in 18 y...

A: Computation:

Q: List and briefly describe three types of mutual funds.

A: Introduction: Mutual fund are institutions involved in pooling of small quantities of different  peo...

Q: 4. Consider a call option on the S&R index with 6 months to expiration and a strike price of $1000. ...

A: Here is the Payoff and Profit diagram if the call option is shown below:

Q: How is high-frequency trading similar to broker-dealerinternalization? How is it different?

A: High-frequency trading is buying and selling the stocks immediately where profits depend on lower bu...

Q: 1. Why are financial markets so keenly regulated? Explain the rational for the regulation 2. A. Nii ...

A: “Hey, since there are multiple questions posted, we will answer first question. If you want any spec...

Q: What is interest rate swap?

A: An interest rate swap is a forward agreement where one wellspring of future coupon installments base...

Q: What are the capital gains rules as applied to residential property owners?

A:   To know the amount of capital gains on the residential property it is important to evaluate the pr...

Q: Western Electric has 35,000 ordinary shares outstanding at a price per share of $47 and a rate of re...

A: a) Market Value is calculated as the number of units outstanding multiplied by the price. Total Ma...

Q: On January 1, 2013, your brother's business obtained a 30-year amortized mortgage loan for $350,000 ...

A: Present value of all the monthly installments is equal to the loan amount. Equated monthly installme...

Q: Bermuda Cruises issues only common stocks and coupon bonds. The firm has a debt-equity ratio of0.45....

A: Click to see the answer

Q: Cash flows estimation and capital budgeting:You are the head of finance department in XYZ Company. Y...

A: It is very important to find the cash flows of a project as they will be used to evaluate the projec...

Q: Define bond rating

A: Bond-rating It is a method for estimating a bond's financial soundness which relates to a guarantor'...

Q: 7. Valuing semiannual coupon bonds Bonds often pay a coupon twice a year. For the valuation of b...

A: Calculation of Value of Treasury Note: Excel Spreadsheet:  

Q: . In general, what are some characteristics of stocksfor which a dividend growth model is appropriat...

A: Answer: Companies making dividend payments and expecting dividend growth at predictable rates must o...

Q: You are an investment advisor and you are asked to guide a new investor to trade shares on the Ghana...

A: Six GSE listing requirements are: 1.  The company should have fifty percent of the board as non-exec...

Q: Q2b You are an investment advisor and you are asked to guide a new investor to trade shares on the G...

A: 6 requirements for a company to get listed on GSE are a) Company background (history and type of bus...

Q: Lee Manufacturing’s value of operations is equal to $900 million after a recapitalization. (The firm...

A: Calculation of stock price after recapitalization: Answer: Price per share (after recapitalization) ...

Q: 10-4 Suppose that five years ago Cisco Systems sold a 15-year bond issue that had a $1,000 par value...

A: Excel Spreadsheet: Excel Workings:

Q: What Does RiskReally Mean?

A: Risk: Risk can be defined as upcoming uncertainty about variation from anticipated earnings or antic...

Q: Explain Entrepreneurial Profits?

A: The question is based on the concept Entrepreneurial Profits, profit earned by an enterprise.

Q: If Edward wants to earn $215,000 within the next 20 years and the salaries grow at 4.15% per year, w...

A: Calculation of the salary that is needed to be earned today is shown below: Hence, the salary neede...

Q: Petrobras, the Brazilian energy company, has identified two alternatives to provide potable water to...

A: Calculation of better economic choice for Petrobras is shown below: Formula sheet for the above cal...

Q: a). Gold Coast Securities Ltd is considering two investment opportunities, purchasing stocks or corp...

A: Standard deviation measures degree of dispersion of the data from the average data. Standard deviati...

Q: Question 1 a. A mutual fund is a professionally managed type of collective investment scheme that po...

A: Performance of the portfolios can be measured by determining the rewards that can be expected over t...

Q: . Risks of investing in bonds A security with higher risk will have a higher expected return. A...

A: The option of the 10-year bond has more interest rate risk is true: Based on the graph, it is clear ...

Q: What techniques can be used to analyze real options?

A: A choice accessible to the organization's managers related to the investment opportunities is known ...

Q: Metropolitan Water Utilities purchases surface water from Elephant Butte Irrigation District at a co...

A: Formula:

Q: A major component of financial planning is toforecast future financial statements. If you had acompa...

A:   Forecasting refers to the process where managers determine or predict the future financial data th...