Calculate the lump sum needed at retirement

Assignment Help Business Economics
Reference no: EM132281506

The Smiths had $110,000 in savings at age 51. They had a desired retirement age of 65. They want to fund through age 92. Assume a 4 percent inflation rate and a 5 percent after-tax rate for investment both pre- and postretirement. They have household income of $140,000, which is increasing at the rate of inflation. Their expenditures including taxes are $125,000 a year. They estimate that in retirement they will receive $28,000 a year together in Social Security and Mr. Smith will receive a $12,000-a-year pension, both in today's dollars.Their retirement expenditures would be $90,000 a year in today's dollars.

a) Calculate the lump sum needed at retirement.

Reference no: EM132281506

Questions Cloud

How symptom control may affect Mrs kapoor and her family : End of Life Care Report - PRINCIPLES OF PALLIATIVE AND END OF LIFE CARE. Chosen principle is the interdisciplinary approach and care need is symptom control
Company return on assets for the fiscal year : Its total assets were $10,000,000. What is the company's return on assets for the fiscal year?
Write a paper about the groundwork for the metaphysics : Write a 4 page paper about the groundwork for the metaphysics of morals on Immanuel Kant using Steven M.Cahn Classics of Political & Moral Philosophy Oxford.
Course of the company annual : A worker is entitled to workers' compensation benefits when disability "arises out of and in the course of employment." A pregnant employee
Calculate the lump sum needed at retirement : Calculate the lump sum needed at retirement.
Review the films and the articles you have chosen : To prepare, you should choose two of the topics, and select the films and articles you wish to use for those essay questions.
Volatility lower than that of the original? stocks : Compute the volatility of a portfolio with 50 % invested in each stock if the correlation between the stocks is ?
Write a memo to the faculty members at anderson college : Write a memo to the faculty members at Anderson College informing them of the revised instructions and where they can access them.
Write an email message to your supervisor : Inform him that you have completed the revision and that you are attaching the revised draft to the email message.

Reviews

Write a Review

Business Economics Questions & Answers

  Emphasize capital accumulation and total factor

Explain to what extent the neoclassical growth theory (e.g. Solow Swan model) that emphasize capital accumulation and total factor productivity.

  Describe a specific instance where heteroscedasticity

Discuss the types of situations where you would expect to see non-constant variance in the data. Provide examples to support your response. Describe a specific instance where heteroscedasticity would be a problem and the remedial measures that could ..

  Value of the standard deviation of the errors

Using the information in the picture attached, what is the value of the standard deviation of the errors or "standard error of the estimate"?

  Economic agents make decisions in particular models

Economic agents make decisions in particular models. These models do not need to be related to financial contexts, and economics can be used to describe how agents will act in any other field in which humans act. As an example, how would economic pri..

  New widget machines for which annual cost data

The ABC Co. is considering purchasing a new widget machine. The company interest rate (MARR) is 12%. Which (if either) of the two new widget machines for which annual cost data are available should ABC purchase? Use incremental rate of return analysi..

  How many numbers from trial one did the person

How many numbers from trial one did the person(s) after at least 24 hours? What type of memory was the person committing this information into?

  Perfect competition is the one industry structure

Perfect Competition is the one industry structure that achieves all of the following. Select one of the achievements of Perfect Competition listed above. Describe what it means in your own words, and state why you believe it to be the most important ..

  Why are costs important in economics

Why are costs important in economics? Why don’t economists use the same cost data as accountants use? What is the real cost of putting an unemployed laborer to work raking leaves or digging holes and refilling them during a severe recession? Explain.

  Us citizens to obtain healthcare coverage

What means exist for U.S citizens to obtain healthcare coverage? Should coverage be voluntary or mandatory?

  Determine the breakeven point

Draw a graph with the sales volume (S) from 0 to 100 on the x axis, and total cost and total income from $0 to $2500 on the y axis. On the graph draw the line

  What are three methods for estimating cost of common stock

What are three methods for estimating the cost of common stock from retained earnings? Which of these methods provides the most accurate and reliable estimate?

  Firm chooses the quantity of output that generates largest

To maximize? profit, the firm chooses the quantity of output that generates the largest:

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd