Indivdual retirement account beginning

Assignment Help Financial Management
Reference no: EM131009935

A) If an individual places $4,000 per year into a Roth indivdual retirement account beginning at age of 35, how much cash will have accumulated by age 65 if 8% interest is erned each year?

B) How much income per year will be generated by this sum if a 25 year annuity is purchased which earns 4% annual interest?

C) How much cash will an individual have at age 65 if he or she invests $4,000 per year into a Roth IPA beginning at age 25 and earns 9% interest per year?

D) How much income per year will be generated by this sum if a 25 year annuity is purchased which earns 4% annual interest?

Reference no: EM131009935

Questions Cloud

What is tax liability-marginal tax rate and average tax rate : Jamie has taxable income of $45,000. She is single and her Tax rates are 10% on the first $7,000 of taxable income, 15% of the amount over $7,000 up to $28,400 of taxable income and 25% on the remainder. What is Jamie's tax liability, her marginal ta..
How much tax would he save by using his itemized deductions : George is single and his standard deduction for the year is $5,800. If he is in the 25% marginal tax bracket, how much tax would he save by using his itemized deductions of $12,600? (Show work and Explain)
Immediate-retirement annuity : An insurance agent is trying to sell you an immediate-retirement annuity, which for a single amount paid today will provide you with $7,200 at the end of each year for the next 35 years. You currently earn 4% on low-risk investments comparable to the..
Standard deviation and the measurement of stock volatility : Because there are a number of risk measures that investors and financial managers can utilize to make decisions, what are your thoughts about the accuracy of standard deviation and the measurement of stock volatility? Is this a good assessor of total..
Indivdual retirement account beginning : If an individual places $4,000 per year into a Roth indivdual retirement account beginning at age of 35, how much cash will have accumulated by age 65 if 8% interest is erned each year? How much income per year will be generated by this sum if a 25 y..
Calculate your total percentage return : You purchase 1,000 shares of stock at $45 per share. A year later the stock pays a dividend of $1.25 per share, and it sells for $49. Calculate your total dollar return. Calculate your total percentage return.
What dividend did the stock pay : A financial adviser claims that a particular stock earned a total return of 10% last year. During the year the stock price rose from $30 to $32.50. What dividend did the stock pay?
What is percentage return : Suppose you have $90,000 to invest. You’re considering Miller-Moore Equine Enterprises (MMEE), which is currently selling for $90 per share. You notice that a put option with a $90 strike is available with a premium of $7.2. Calculate your percentage..
What are the two benchmark securities for measuring risk : What does financial analysts rely on when researching different investments? What are two well-known market indices? What is the basis for each index? Do these market indices track a large number of stocks? If not why are they used so much? What are ..

Reviews

Write a Review

Financial Management Questions & Answers

  Firms weighted average cost of capital

All of the following will make the break-even point increase, other things equal, EXCEPT. Assuming no corporate taxes, the independence hypothesis suggests that a firm's weighted average cost of capital will

  Will that be all the revenue received that month

Suppose that a health care organization had revenues of $300,000 for March and that the payer mix is as follows: PAYER PERCENT OF PATIENTS PAYMENT LAG Medicare 40 3 months Medicaid 20 3 months Blue Cross 15 2 months Other insurer 15 1 month Self-pay ..

  Firm evaluates-should the firm accept the project

A firm evaluates all of its projects by applying the IRR rule. A project under consideration has the following cash flows: Year Cash Flow 0 –$ 27,000 1 11,000 2 14,000 3 10,000. If the required return is 16 percent, what is the IRR for this project? ..

  This investment are at least roughly normally distributed

An investment has an expected return of 12% per year with standard deviation of 6%. Assuming that the returns on this investment are at least roughly normally distributed, how frequently do you expect to lose money?

  What is the net present value of paying the points

A homeowner can obtain a $250,000, 30-year fixed-rate mortgage at a rate of 6.0 percent with zero points or at a rate of 5.5 percent with 2.25 points. If you will keep the mortgage for 30 years, what is the net present value of paying the points (to ..

  What are the break-even levels of ebit for each plan

Haskell Corp. is comparing two different capital structures. Plan I would result in 8,000 shares of stock and $80,000 in debt. Plan II would result in 6,000 shares of stock and $120,000 in debt. The interest rate on the debt is 6 percent. In part (a)..

  Product offerings to reach a wider range of customers

Home Furnishings is expanding its product offerings to reach a wider range of customers. The expansion project includes increasing floor inventory by $656,000 and increasing its debt to suppliers by 85 percent of that amount.

  What is the required rate of return on this stock

Proxicam, Inc., is expected to grow at a constant rate of 9.25 percent. If the company’s next dividend, which will be paid in a year, is $1.45 and its current stock price is $22.35, what is the required rate of return on this stock?

  Description of two possible hedging approaches

For a U.K. firm to hedge a ?100,000 payable using options, there are two possible ways the firm can approach this. Can you please provide a description of each of the two possible hedging approaches?

  What is the value of the firm

O’Connell & Co. expects its EBIT to be $83,000 every year forever. The firm can borrow at 11 percent. O’Connell currently has no debt, and its cost of equity is 15 percent. If the tax rate is 35 percent, what is the value of the firm? What will the v..

  What will GFCs stock price likely be after the split

Global Financial Corporation (GFC) has 10 million shares outstanding, each currently worth $80 per share. The firm’s mangers are considering a plan to split the company’s stock 2-for-1, but they are concerned about the impact this split announcement ..

  Whats the monthly payment

Whats the monthly payment and how much is the borrowers income tax write off in the first year?

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