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PFIN 5th Edition by Randall Billingsley,Lawrence Gitman,Michael Joehnk
Edition 5ISBN: 978-1305661707PFIN 5th Edition by Randall Billingsley,Lawrence Gitman,Michael Joehnk
Edition 5ISBN: 978-1305661707 Exercise 4
Funding a retirement goal. Jamal Doran wishes to have $800,000 in a retirement fund 20 years from now. He can create the retirement fund by making a single lump-sum deposit today.
a. If upon retirement in 20 years, Jamal plans to invest $800,000 in a fund that earns 4 percent, what is the maximum annual withdrawal he can make over the following 15 years?
b. How much would Jamal need to have on deposit at retirement in order to withdraw $35,000 annually over the 15 years if the retirement fund earns 4 percent?
c. To achieve his annual withdrawal goal of $35,000 calculated in part b, how much more than the amount calculated in part a must Jamal deposit today in an investment earning 4 percent annual interest?
a. If upon retirement in 20 years, Jamal plans to invest $800,000 in a fund that earns 4 percent, what is the maximum annual withdrawal he can make over the following 15 years?
b. How much would Jamal need to have on deposit at retirement in order to withdraw $35,000 annually over the 15 years if the retirement fund earns 4 percent?
c. To achieve his annual withdrawal goal of $35,000 calculated in part b, how much more than the amount calculated in part a must Jamal deposit today in an investment earning 4 percent annual interest?
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PFIN 5th Edition by Randall Billingsley,Lawrence Gitman,Michael Joehnk
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