+1-415-315-9853

info@mywordsolution.com

Finance

 Basic Finance Corporate Finance Financial Management Financial Econometrics Portfolio Management Risk Management Public Finance Business Law & Ethics

1. Peggy gets paid every other week (bi-weekly) and her husband Patrick gets paid monthly. Peggy is going to make a \$150 deposit from her paycheck every two weeks into a new retirement fund, and Patrick is going to deposit \$300 from his paycheck monthly into a new retirement fund. Both accounts earn an effective annual rate of 6%. Peggy's account compounds bi-weekly and Patrick's fund compounds monthly that matches their deposits.

a. What together can Peggy and Patrick expect to receive from their deposits in 30 years?
b. How much would Patrick have to deposit each month for the combined savings to achieve \$1 million in thirty years? (Peggy would continue as above.)

2. Kim is evaluating her retirement plan. Suppose she has \$500,000 when she retires in an account that earns at an effective annual rate of 9%.

a. If Kim withdraws \$75,000 annually, how long will her funds last?
b. To make the funds last 25 years, how much can Kim withdraw annually?
c. Kim is considering a two phase withdrawal where she withdraws \$60,000 annually for 10 years, and then \$35,000 thereafter (when social security starts). How long will her funds last assuming that the 9% rate of return (EAR) is accurate for both phases of the retirement plan.

3. Peggy gets paid every other week (bi-weekly) and her husband Patrick gets paid monthly. Peggy is going to make a \$150 deposit from her paycheck every two weeks into a new retirement fund, and Patrick is going to deposit \$300 from his paycheck monthly into a new retirement fund. Both accounts earn an effective annual rate of 6%. Peggy's account compounds bi-weekly and Patrick's fund compounds monthly that matches their deposits.

a. What together can Peggy and Patrick expect to receive from their deposits in 30 years?
b. How much would Patrick have to deposit each month for the combined savings to achieve \$1 million in thirty years? (Peggy would continue as above.)

4. John is going to buy a new car costing \$24,000. Wealthy Uncle Job offered a choice of three loans as described below. The annual percentage rate with monthly compounding for all three alternative loans would be 3.25% and the loans would be for 4 years. Determine the payment amount that John would have to make for each loan alternative?

Loan 1 Loan 1 would be for the total cost of the car and John would pay equal monthly payments to Uncle Job .
Loan 2 Loan 2 would be for the total cost of the car with John making a \$3,000 payment at the end of the loan and equal annual payments to Uncle Job for the remainder.
Loan 3 Loan 3 would have John using \$3000 of his personal savings upfront to reduce the loan size and John would make equal monthly payments to Uncle Job.

5. Pat Davis has earned a promotion that will pay an annual bonus of \$10,000 at the end of the first year and increase by 12% each year thereafter. He is going to deposit his annual bonus into a fund that has an annual percentage rate of 5% compounded monthly that presently has \$30,000 in it. He plans to retire in 15 years. How much will be in the fund at the time he retires?

Basic Finance, Finance

• Category:- Basic Finance
• Reference No.:- M925549

Have any Question?

Related Questions in Basic Finance

Assignmenti have a project in finance i need done i

Assignment I have a project in finance I need done. I attached the details. There must be NO PLAGIARISM, thank you. The report should be atleast 15 Pages. Objectives Students should familiarize themselves with bonds and/ ...

An article in the wall street journal in early 2010 noted

An article in the Wall Street Journal in early 2010 noted: "Some small business owners say they could expand if they could just get a loan." Over the past 35 years, has making loans to small business become a more import ...

1 present alternative arguments about saving jobs looking

1. Present alternative arguments about saving jobs, looking at how saving jobs in one industry might eventually hurt another industry. 2. Based on your knowledge of trade theory, discuss the usefulness of limiting textil ...

Your firm is considering a new investment proposal and

Your firm is considering a new investment proposal and would like to calculate its weighted average cost of capital. To help in this, compute the cost of capital for the firm for the following: a. A bond that has a \$1000 ...

1 give an example of why a review of bank assets may

1. Give an example of why a review of bank assets may indicate risk or opportunity of which you were not aware 2. Why review the disclosure of the market value of investments versus the book amount of investments for ban ...

1 in what sense could one argue that if managers make

1. In what sense could one argue that if managers make decisions using breakeven analysis, they are not maximizing shareholder wealth? How can breakeven analysis be modified to solve this problem? 2. Explain the differen ...

1 what information is contained in each of the

1. What information is contained in each of the supplementary sections of the research report? 2. How are the levels of the headings of a research report determined? 3. Summarize the writing and stylistic goals that can ...

1 what is the break-even mortgage interest rate beir in the

1. What is the break-even mortgage interest rate (BEIR) in the context of financial leverage? Would you ever expect an investor to pay a break-even interest rate when financing a property? Why or why not? 2. Why might a ...

What is the difference between shareholder and stakeholder

What is the difference between shareholder and stakeholder value? What is social responsibility? How does it, if at all, contribute to shareholder and stakeholder value? Does it add value to the firm? If so, how and unde ...

1 what benefits do flexible unit-load materials have in

1. What benefits do flexible unit-load materials have in contrast to rigid containers? How do return or reverse logistics considerations impact the two approaches? 2. What trade-offs are involved in the use of returnable ...

• 13,132 Experts

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro