Engineering Economy (17th Edition)
Engineering Economy (17th Edition)
17th Edition
ISBN: 9780134870069
Author: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher: PEARSON
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Chapter 8, Problem 17P
To determine

Calculate the value of life insurance.

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Joe just completed his engineering degree and started to work for an engineering firm. Joe wants to retire early after 30 years working. He plans to invest $5,000 at the end of every year for a 30-year career. If Joe needs $3,954,750 (about $1,400,000 in today's dollars accounting for an expected 3.5% inflation rate) in savings at retirement, what interest rate must the investment earn?
An engineer's salary was P50, 000.00 in 2006. The same engineer's salary in 2011 is P80, 000.00. If the company's salary policy dictates that a yearly raise in salaries reflect the cost of living increase due to inflation, what is the average inflation rate?
Goods costing $27.10 at the beginning of the year 1940 cost $176.52 at the beginning of the year 1979. Find the average annual inflation rate over this time period. Express your answer the nearest thousandth of a percent.
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