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Adam is 24 years old and has a 401(k) plan through his employer. His company maches 50% of his contributions up to 6% of his salary. He currently contriubtes the maximum amount he can. In his 401(k), he has three funds. Invesntment A is a large-cap index fund, which has had an average annual growth over the past 10 years of 6.63% with a standard deviatiob of 13.46%. Investment B is a mid-cap index fund with a 10-year average annual growth of 9.89% and standard deviation of 15.28%. Finally, Investment C is a small-cap Index fund with a 10-year average annual growth of 8.55% and a standrad deviation of 16.90%. 50% of his contribution id directed to Invesment A, 25% to Investment B and 25% to Investment C. His current salary is $48,000 and based on a compensation survey of finacial survey institutions, he expects an average raise of 2.7% with a standard deviation of 0.4% each year. Develop a simulation model to predict how much he will have available at age 60.

Operation Management, Management Studies

  • Category:- Operation Management
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