Would like to have enough money saved to receive a growing annun · years, growing at a rate of 4% per year, w...

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Would like to have enough money saved to receive a growing annun · years, growing at a rate of 4% per year, with the first pa

You would like to have enough money saved to receive a growing annuity for 25 years, growing at a rate of 4% per year, with t

business accounting

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Answer 1

Answer #1

Answer -

As per given information,

First payment (P) = $60000

Rate per period (r) = 12%

Growth rate (g) = 4%

Number of periods (n) = 25 years

So,

Present value (PV) of growing annuity :

PV=620 11-679)

60000 L. PV = 10.12 -0.04) (1+0.04 25 1+0.12)

PV =6000 – :)

PV = 632390.02

You need to save $632390.02 in your retirement fund to achieve the goal.

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Answer 2

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Add Answer to: Would like to have enough money saved to receive a growing annun · years, growing at a rate of 4% per year, w...

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