The following table shows the average returns for some of the largest mutual funds commonly found in retirement plans. (Assume end-of-month deposits and withdrawals and monthly compounding, and assume that the quoted rate of return continues indefinitely.) Mutual Fund Fidelity Growth Company Vanguard 500 Index Vanguard Total Bond Market Index PIMCO Total Return Rate of 14.83% 14.25% 2.77% 3.67% Return Туре Stock fund Stock fund Bond fund Bond fund Part 1 How much would be accumulated after 25 years in a retirement account invested entirely in the Vanguard stock fund with payments of $300 per month? HINT [See Quick Example 1.] (Round your answer to the nearest cent.) Part 2 For the past 25 years you have been depositing $700 per month in the Vanguard bond fund, and you have now transferred your current balance to the PIMCO bond fund, where you plan to continue depositing $700 per month until you retire in 30 years. How much can you anticipate having in the investment when you retire? HINT [See Example 1.] (Round your ancwer to the poarect cont)
The following table shows the average returns for some of the largest mutual funds commonly found in retirement plans. (Assume end-of-month deposits and withdrawals and monthly compounding, and assume that the quoted rate of return continues indefinitely.) Mutual Fund Fidelity Growth Company Vanguard 500 Index Vanguard Total Bond Market Index PIMCO Total Return Rate of 14.83% 14.25% 2.77% 3.67% Return Туре Stock fund Stock fund Bond fund Bond fund Part 1 How much would be accumulated after 25 years in a retirement account invested entirely in the Vanguard stock fund with payments of $300 per month? HINT [See Quick Example 1.] (Round your answer to the nearest cent.) Part 2 For the past 25 years you have been depositing $700 per month in the Vanguard bond fund, and you have now transferred your current balance to the PIMCO bond fund, where you plan to continue depositing $700 per month until you retire in 30 years. How much can you anticipate having in the investment when you retire? HINT [See Example 1.] (Round your ancwer to the poarect cont)
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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![The following table shows the average returns for some of the largest mutual funds commonly found in retirement plans.
(Assume end-of-month deposits and withdrawals and monthly compounding, and assume that the quoted rate of return
continues indefinitely.)
Fidelity
Growth
Vanguard
Total Bond
Vanguard
Mutual
Fund
PIMCO
500 Index
Total Return
Company
Market Index
Rate of
14.83%
14.25%
2.77%
3.67%
Return
Туре
Stock fund
Stock fund
Bond fund
Bond fund
Part 1
How much would be accumulated after 25 years in a retirement account invested entirely in the Vanguard stock fund with
payments of $300 per month? HINT [See Quick Example 1.] (Round your answer to the nearest cent.)
Part 2
For the past 25 years you have been depositing $700 per month in the Vanguard bond fund, and you have now transferred
your current balance to the PIMCO bond fund, where you plan to continue depositing $700 per month until you retire in
30 years. How much can you anticipate having in the investment when you retire? HINT [See Example 1.] (Round your
answer to the nearest cent.)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F26a14586-237c-4659-8395-37c297bf76d4%2F953e5ca4-1fbe-440e-98cf-50b91ee85303%2F6oiiomo_processed.jpeg&w=3840&q=75)
Transcribed Image Text:The following table shows the average returns for some of the largest mutual funds commonly found in retirement plans.
(Assume end-of-month deposits and withdrawals and monthly compounding, and assume that the quoted rate of return
continues indefinitely.)
Fidelity
Growth
Vanguard
Total Bond
Vanguard
Mutual
Fund
PIMCO
500 Index
Total Return
Company
Market Index
Rate of
14.83%
14.25%
2.77%
3.67%
Return
Туре
Stock fund
Stock fund
Bond fund
Bond fund
Part 1
How much would be accumulated after 25 years in a retirement account invested entirely in the Vanguard stock fund with
payments of $300 per month? HINT [See Quick Example 1.] (Round your answer to the nearest cent.)
Part 2
For the past 25 years you have been depositing $700 per month in the Vanguard bond fund, and you have now transferred
your current balance to the PIMCO bond fund, where you plan to continue depositing $700 per month until you retire in
30 years. How much can you anticipate having in the investment when you retire? HINT [See Example 1.] (Round your
answer to the nearest cent.)
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