You would like to have enough money saved to receive a $90,000 per year perpetuity after retirement. The annual interest rate is 8 percent. Required: How much would you need to have saved in your retirement fund to achieve this goal? a) Assume that the perpetuity payments start on the day of your retirement. b) Assume that the perpetuity payments start one year from the date of your retirement.
You would like to have enough money saved to receive a $90,000 per year perpetuity after retirement. The annual interest rate is 8 percent. Required: How much would you need to have saved in your retirement fund to achieve this goal? a) Assume that the perpetuity payments start on the day of your retirement. b) Assume that the perpetuity payments start one year from the date of your retirement.
Chapter5: The Time Value Of Money
Section: Chapter Questions
Problem 32P
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- You would like to have enough money saved to receive a $90,000 per year perpetuity after retirement. The annual interest rate is 8 percent.
Required: How much would you need to have saved in your retirement fund to achieve this goal?
a) Assume that the perpetuity payments start on the day of your retirement.
b) Assume that the perpetuity payments start one year from the date of your retirement.
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