Ellie wants to endow a college scholarship to honor her late grandmother. She wants to save...
Ellie wants to endow a college scholarship to honor her late grandmother. She wants to save enough money to support withdrawals of $15,000 per year (forever). Ellie will save to fund this scholarship for the next 20 years. The first scholarship withdrawal will be at the time of her last contribution to the endowment. While she saves money for the endowment, Ellie can earn 8% APR per year. Once she has funded the endowment, Ellie will move the money into a safe account that pays 3% per year. What yearly contribution must Ellie make to achieve her goal?
Homework Answers
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Use
the following information to answer each question Allison wants to
save for retirement. She is 20 and wants to retire in 40 years. She
is considering two options and expects to earn an 8% annual return
under each option.
Option 1: She is considering contributing $6,000 per year to
an IRA for 10 years at which time she figures she will be tired of
self-deprivation save no more. The invested funds, however, will
continue to grow until she retires....
Aloma, a university graduate who started a successful business, wants to start an endowment in her name that will provide scholarships to EE students. She wants the scholarship to provide $17.000 per year and expects the first one to be awarded on the day she fulfills the endowment obligation. If Aloma plans to donate $240.000 what rate of return must the university realize in order to award the annual scholarship forever? The rate of return that the university must realize...
Francis Fray is saving for her retirement fund. She wants to have $450,000 in 30 years when she turns 75 . She expects the APR to be 6% compounded monthly a. How much should she deposit each month? b, She has decided to save even more each month to get to her goal and is planning to deposit $550 each month. How long will it take her to achieve her goal of $450,000? Thank you
Stefani German, a 40-year-old woman, plans to retire at age 65, and she wants to accumulate $420,000 over the next 25 years to supplement the retirement programs that are being funded by the federal government and her employer. She expects to earn an average annual return of about 6% by investing in a low-risk portfo containing about 20% short-term securities, 30% common stock, and 50% bonds Ste ani currently has $37.280 hat a an annual rate o return o 6%...
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Use
the following information to answer each question Allison wants to
save for retirement. She is 20 and wants to retire in 40 years. She
is considering two options and expects to earn an 8% annual return
under each option.
Option 1: She is considering contributing $6,000 per year to
an IRA for 10 years at which time she figures she will be tired of
self-deprivation save no more. The invested funds, however, will
continue to grow until she retires....
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