Log in
Finance
1
answer
0
watching
713
views

A person wants to establish an annuity for retirement purposes. He wants to make quarterly deposits for 20 years so that he can then make quarterly withdrawals of $5000 for 10 years. The annuity earns 7.32% interest compounded quarterly.

(a) How much will have to be in the account at the time he retires?

(b) How much should be deposited each quarter for 20 years in order to accumulate the required amount?

(c) What is the total amount interest earned during the 30-year period?

Watch
1
answer
0
watching
713
views

For unlimited access to Homework Help, a Homework+ subscription is required.

Avatar image
Liked by hableelsaif
Jamar Ferry
Jamar FerryLv2
29 Sep 2019

Unlock all answers

Get 1 free homework help answer.
Already have an account? Log in
Share

Related questions

it's about Compound Interest Future Value

1-Raymond deposited his $1,000 bonus into an account paying 5.2% compounded semiannually. How much money will he have at the end of 7 years?

2-Stacy is going on a vacation to Europe at the end of 2 years. She deposits $6,141 in an account earning 4% interest compounded semiannually. How much money will Stacy have in he account for her trip?

3-Dan deposits $5,500 into a Certificate of Deposit (CD) paying 2.5% interest compounded quarterly. How much money will be in his account at the end of 17 years?

4-William deposited $7,000 into an account paying 7.7% compounded quarterly. Calculate how much money will be in the account at the end of 7 years.

5-Josh deposits $3,000 into an account paying 4% interest compounded monthly. What will the account be worth at the end of 23 years?

6-Jamie won $750 in a raffle at school. After donating $50 to charity, he deposited the remaining amount into an account paying 5% interest compounded quarterly. How much will the account be worth at the end of 15 years?

7-Mark deposited $5000 into an account paying 9% interest compounded monthly. How much money will he have at the end of 20 years?

8-Gary received a bonus of $8,000. He gave his son $720 and invested the remaining amount into a savings account earning 3% interest compounded quarterly. If he leaves the money in the account for 5 years, how much money will be in the account?

9-Curtis is 19 and wants to start saving money for retirement. He deposited $8,000 in an account earning 6% interest compounded semiannually. At the end of 50 years, how much will he have in the account for his retirement?

10-Franella wants to buy her dream car when she retires in 14 years. She deposits $20,000 in an account paying 8.4% interest compounded monthly. How much will she have to put towards her dream car at the end of 14 years?

A) Eugene began to save for his retirement at age 35, and for 10 years he put $ 200 per month into an ordinary annuity at an annual interest rate of 6% compounded monthly. After the 10 years, Eugene was unable to make the monthly contribution of $ 200, so he moved the money from the annuity into another account that earned 6% interest compounded monthly. He left the money in this account for 20 years until he was ready to retire. How much money did he have for retirement?

Retirement amount=

B) If Eugene had waited until he was 45 years old to start saving for retirement and then decided to put money into an ordinary annuity for 20 years earning 6% interest compounded monthly, what monthly payment would he have to make to accumulate the same amount for retirement as you found in the first part of the question?

Retirement amount =

Upon graduating from college 35 years ago, Dr. Nick Riviera was already
thinking of retirement. Since then he has made deposits into his retirement fund on a quarterly basis in the amount of $300. Nick has just completed his final payment and
is at last ready to retire. Additionally, an uncle died 15 years ago and Nick received a check of $20, 000 at that time. He deposited the entire amount into his retirement
fund.
If Nick expects to live for 20 more years, how much will his quarterly income be
during his retirement? His retirement fund has earned 9% compounded quarterly.
This rate of return is expected to continue.10. Upon graduating from college 35 years ago, Dr. Nick Riviera was already
thinking of retirement. Since then he has made deposits into his retirement fund on a
quarterly basis in the amount of $300. Nick has just completed his final payment and
is at last ready to retire. Additionally, an uncle died 15 years ago and Nick received a
check of $20, 000 at that time. He deposited the entire amount into his retirement
fund.
If Nick expects to live for 20 more years, how much will his quarterly income be
during his retirement? His retirement fund has earned 9% compounded quarterly.
This rate of return is expected to continue.

Weekly leaderboard

Home
Homework Help 3,900,000
Finance 370,000
Start filling in the gaps now
Log in