Exam 4: Managing Money

Solve the problem. -Suppose that you want to have a $160,085 retirement fund after 42 years. How much will you need to deposit now if you can obtain an APR of 3%, compounded daily? Assume that no additional Deposits are to be made to the account.

Solve the equation for the unknown. - $( x - 2 ) ^ { 3 } = 8$

Provide an appropriate response. -The publicly held debt represents money the government must repay to individuals and institutions that bought Treasury issues.

Solve. -Jim is in the 15% tax bracket and itemizes his deductions. How much will his tax bill be reduced if he makes a $4097 contribution to charity?

Solve the problem. Refer to the table if necessary. 2013 Marginal Tax Rates, Standard Deductlons, and Exemptlons** - Each higher marginal rate begins where the prior one leaves off. For example, for a single person, the $15 \%$ marginal rate affects income starting at $\$ 8925$ , which is where the $10 \%$ rate leaves off, and continuing up to $\$ 36,250$ . " This table ignores the effects of (i) exemption and deduction phase-outs that apply to high-income taxpayers and (ii) the alternative minimum tax (AMT) that affects many middle- and high-income taxpayers. -Kevin is married, but he and his wife filed separately. His gross salary was $37,967, and he earned $448 in interest. He had $1141 in itemized deductions and claimed three exemptions for himself And two children. Find his taxable income.

Solve the problem. -Suppose your after-tax income is $37,050. Your annual expenses are $32,426 for rent, $6572 for food and household expenses, $1265 for interest on credit cards, and $7396 for entertainment, travel, and Other. You expect to get a 25% raise next year. Will this affect the outcome?

Solve. -Determine the total payment over the term of a student loan of $107,762 at a fixed APR of 8.3% for 30 years.

Write the word or phrase that best completes each statement or answers the question.Decide whether the statement makes sense. Explain your reasoning. -I am young and I am looking for high-return investments even if that means higher risk. That's why I am putting most of my money into stocks.

Solve the problem. Refer to the table if necessary. 2013 Marginal Tax Rates, Standard Deductions, and Exemptlons** - Each higher marginal rate begins where the prior one leaves off. For example, for a single person, the $15 \%$ marginal rate affects income starting at $\$ 8925$ , which is where the $10 \%$ rate leaves off, and continuing up to $\$ 36,250$ . " This table ignores the effects of (i) exemption and deduction phase-outs that apply to high-income taxpayers and (ii) the alternative minimum tax (AMT) that affects many middle- and high-income taxpayers. -Abbey earned $70,218 in wages. Kathryn earned $70,218, all in dividends and long-term capital gains. Calculate the total tax owed by each, including both FICA and income taxes. Assume they Are both single and take the standard deduction. Note that long-term capital gains and dividends Are taxed at 0% for income in the 10% and 15% tax brackets and at 15% for income in all higher tax Brackets.

Write the word or phrase that best completes each statement or answers the question.Decide whether the statement makes sense. Explain your reasoning. - Bill is in the 15% tax bracket so the tax he owes will be 15% of his taxable income.

Determine whether the spending pattern described is at, above, or below the national average. Assume that any salariesor wages are after tax. -A couple in their forties with a combined household income of $56,000 per year spends $400 per month on health care.

Solve the problem. -You just put $4399 in a CD that is expected to earn 8% compounded quarterly, and $6876 in a savings account that is expected to earn 3% compounded semiannually. Determine when, to the Nearest year, the values of your two investments will be the same.

Solve the problem. Refer to the table if necessary. -John is married filing separately with taxable income of $141,766. Calculate the amount of tax owed.

Answer the question. -You must decide whether to buy a new car for $28,000 or lease the same car over a three-year period. Under the terms of the lease, you make a down payment of $2000 and have monthly Payments of $350. At the end of three years, the leased car has a residual value (the amount you Pay if you choose to buy the car at the end of the lease period)of $15,000. Assume you sell the new Car at the end of three years at the same residual value. Compare the cost of leasing and buying the Car.

Use the given stock table to answer the question. -How does the share price for company ABC compare to the profit per share that it earned in the past year?

Use the given stock table to answer the question. -How much profit per share did company XYZ earn in the past year?

Solve the problem. Refer to the table if necessary. $2013 \text { Marginal Tax Rates, Standard Deductlons, and Exemptlons** }$ - Each higher marginal rate begins where the prior one leaves off. For example, for a single person, the $15 \%$ marginal rate affects income starting at $\$ 8925$ , which is where the $10 \%$ rate leaves off, and continuing up to $\$ 36,250$ . " This table ignores the effects of (i) exemption and deduction phase-outs that apply to high-income taxpayers and (ii) the alternative minimum tax (AMT) that affects many middle-and high-income taxpayers. -Tom and Toni are married and file jointly. Their combined wages were $78,148. They earned a net of $1593 from a rental property they own, and they received $1665 in interest. They claimed four Exemptions for themselves and two children. They contributed $3364 to their tax-deferred Retirement plans, and their itemized deductions total $10,516. Find their taxable income.

Evaluate or simplify the following the expression. - $4 ^ { 2 } \times 4 ^ { - 2 }$

Compute the total and annual returns on the described investment. -Four years after buying 800 shares of XYZ stock for $40 per share, you sell the stock for $3000.

Solve the problem. Refer to the table if necessary. -Your deductible expenditures are $8236 for interest on a home mortgage, $3528 for contributions to charity, and $634 for state income taxes. Your filing status entitles you to a standard deduction of $12,200. Should you itemize your deductions rather than claiming the standard deduction? If so, What is the difference?