6. Mary is paid bi-weekly and she is currently 20 years old. Mary wants to have $500 at the end of each month for 20 years after she retires at the age of 60. If interest rate is expected to 10% p.a. compounded monthly. a. How much does Mary need when she reaches 60 years old? b. In order for Mary to reach her goal, Mary starts to contribute into her retirement saving plan at the end of each pay starting now. Suppose during her work time, interest rate is fixed at 8% p.a. compounded monthly. How much should she contribute per paid?
6. Mary is paid bi-weekly and she is currently 20 years old. Mary wants to have $500 at the end of each month for 20 years after she retires at the age of 60. If interest rate is expected to 10% p.a. compounded monthly. a. How much does Mary need when she reaches 60 years old? b. In order for Mary to reach her goal, Mary starts to contribute into her retirement saving plan at the end of each pay starting now. Suppose during her work time, interest rate is fixed at 8% p.a. compounded monthly. How much should she contribute per paid?
Chapter4: Time Value Of Money
Section: Chapter Questions
Problem 14PROB
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