The nominal return on your investment

Assignment Help Financial Management
Reference no: EM13870851

You want to have $3 million in real dollars in an account when you retire in 40 years. The nominal return on your investment is 10 percent and the inflation rate is 4 percent. What real amount must you deposit each year to achieve your goal?

Reference no: EM13870851

Questions Cloud

What type of ownership interest is appropriate : What type of ownership interest is appropriate in each of the following?
Would companys r and d employees learn to appreciate : Would the company's R&D employees learn to appreciate the possibility that ideas from external environments could enrich and inspire internal research, thereby avoiding the "not invented here" syndrome?
What is the default risk premium on the corporate bond : A Treasury bond that matures in 10 years has a yield of 5%. A 10-year corporate bond has a yield of 7.75%. Assume that the liquidity premium on the corporate bond is 0.4%. What is the default risk premium on the corporate bond?
Effects of a changing competitive environment : Then, evaluate the effects of a changing competitive environment on a company's branding approaches and practice and apply brand theory and strategies to build and sustain brand image
The nominal return on your investment : You want to have $3 million in real dollars in an account when you retire in 40 years. The nominal return on your investment is 10 percent and the inflation rate is 4 percent. What real amount must you deposit each year to achieve your goal?
Why did white record these expenses in the general journal : Does recording the transaction in the general journal rather than the cash payments journal affect the amounts of cash and total expenses reported in the financial statements - Why did White record these expenses in the general journal?
Equity fund with an expected risk premium : You manage an equity fund with an expected risk premium of 11.4% and a standard deviation of 28%. The rate on Treasury bills is 5.2%. Your client chooses to invest $50,000 of her portfolio in your equity fund and $150,000 in a T-bill money market fun..
What were pros that could be found in organizational shift : In which way could standardization compromise the internal creativity? What were the pros and cons that could be found in the organizational shift from matrix to functional lines?
Investor company reports equity income : If the investor company owns 30% of the stock of the investee company and the investee company reports profits of $ 150,000, then the investor company reports equity income of

Reviews

Write a Review

Financial Management Questions & Answers

  Calculate the operating cash flows

(Calculating operating cash flows) assume that a new project will annually generate revenues of $ 2,600,000. Cash expenses including both fixed and variable costs will be $ 500,000, and depreciation will increase by $ 180,000 per year. In addition, l..

  Purchase an asset that is expected to generate cash flows

You have the opportunity to purchase an asset that is expected to generate cash flows for the next 32 years. The purchase price of the asset is $18,650,866. What annual annuity cash flow would you have to expect to receive over the life of the asset ..

  Banks balance sheet and calculate the banks excess reserves

The Fed makes an open-market purchase of $5 million in an economy in which no bank holds excess reserves and the assumptions of the simple multiplier hold with a reserve requirement of 8 percent. Draw up the bank's balance sheet and calculate the ban..

  Times-interest-earned ratio

AEI Incorporated has $7 billion in assets, and its tax rate is 40%. Its basic earning power (BEP) ratio is 11%, and its return on assets (ROA) is 6%. What is AEI's times-interest-earned (TIE) ratio? Round your answer to two decimal places

  Some industries such as airlines rely heavily on debt

Why do you believe some industries such as airlines rely heavily on debt, while others such as computers do not?

  Take the rebate and use the financing from the bank

Kyle Parker of Fayetteville, Arkansas, has been shopping for a new car for several weeks. So far, he has negotiated a price of $27,000 on a model that carries a choice of a $2500 rebate or dealer financing at 2 percent APR. The dealer loan would requ..

  Explain what is the future value of investment cash flows

If the appropriate interest rate is 8.16 percent, what is the future value of these investment cash flows six years from today?

  What was the dividend yield for the year

The common stock of Acadia, Inc., sold for $32.90 at the beginning of the year and $33.12 at the end of the year. During the year, the stock paid $1.10 in dividends. What was the dividend yield for the year?

  A balance sheet shows a total of no callable

A balance sheet shows a total of no callable $41 million long-term debt with a coupon rate of 8.10% and a yield to maturity of 8.50%. This debt currently has a market value of $52 million. The balance sheet also shows that the company has 9 million s..

  What is the purpose of conducting an experiment?

What is the purpose of conducting an experiment?

  Projected sales for the first six months

LPD Logistics, Inc.'s projected sales for the first six months of 2010 are given below.  20% of sales are collected in the month of the sale, 75% are collected in the month following the sale, and 5% are written off as uncollectible. Cost of goods so..

  Considering the purchase of a new cookie oven

Mom’s Cookies Inc. is considering the purchase of a new cookie oven. The original cost of the old oven was $30,000; it is now five years old, and it has a current market value of $13,333.33. The old oven is being depreciated over a 10-year life towar..

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