Computing the future accumulation in current dollars

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Question: Your clients' goal is to accumulate a retirement fund of $300,000 in current (today's) dollars 16 years from now. Inflation is expected to be 4% per year during this 16-year period. If the clients set aside $20,000 at the end of each year and earn 6% on the investment, will they reach their goal? Based on the assumptions, what is the difference between the future accumulation measured in current dollars and your client's goal?

Reference no: EM131797957

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