Retirement fund earning

Assignment Help Financial Management
Reference no: EM131189867

If person A contributes $250 per month to a retirement fund earning 11% per year for 12 years and then just leaves the amount in there to earn for the next 25 years and person B starts investing $250 per month to the same fund at the same time as person A stops contributing and continues for the next 25 years how much will each person have 37 years from now?

Please show your work in Excel.

Reference no: EM131189867

Questions Cloud

Traditional and wacky-using logical and economic arguments : You are the Chairman of the Board of Directors, and you need to choose one of these schemes. Scheme one (Traditional): Let X denote the closing stock price at the time the stock option is granted. The stock option has 10 years until it expires worthl..
Require on a project of average risk : The Chris-Kraft Co. is financed entirely with equity and the firm has a beta of 1.6. The current risk-free rate is 9.5 percent and the expected market return is 16 percent. What rate of return should Chris-Kraft require on a project of average risk?
Considering an investment project with risk : The Chris-Kraft Co. is financed entirely with equity and the firm has a beta of 1.25. The current risk-free rate is 7 percent and the expected market return is 15 percent. Chris-Kraft is considering an investment project with a risk that matches the ..
Retirement fund earning : If person A contributes $250 per month to a retirement fund earning 11% per year for 12 years and then just leaves the amount in there to earn for the next 25 years and person B starts investing $250 per month to the same fund at the same time as per..
What is the per share value after the repurchase : A firm with 100 million shares outstanding repurchased 10 million shares at the market price of $20 per share. What is the total market value of the equity after the repurchase? What is the per share value after the repurchase?
The assumption that abnormal growth forecasted : Cisco Systems traded at $20 per share on December 3, 2001. Analysts are forecasting earnings per share of 0.22 for 2002 and 0.39 for 2003. The firm does not pay dividends. Value Cisco on the assumption that abnormal growth (AEG) forecasted for 2003 w..
If the stable dollar assumption were dropped : Palomar Paper Products purchased land in 1996 for $15,000 cash. The company has held the land since that time. In 2014 Palomar purchased another tract of land for $15,000 cash. Explain how one could adjust the dollar amount reported in the land accou..
Loss reflected on the company financial statements : Recently Boeing has maintained a cash balance of over $10 billion. At an annual inflation rate of about 2 percent, does cash have more or less purchasing power at the end of a given year than at the beginning? By how much? Is such a gain or loss refl..

Reviews

Write a Review

Financial Management Questions & Answers

  Foregone future value of this reduced saving

Susan plans to reduce her savings (that is, she will spend more) by $70 a month. What would be the foregone future value of this reduced saving over the next 10 years?

  What is the increase in the value of the equity

A firm has access to two mutually exclusive investment projects. Both the projects require an initial investment of $15,000. If project 1 is undertaken, with probability 1/2, it pays off $20,000 or $34,000. What are the expected payoffs to the bank a..

  Projected sales-estimate of the current stock price

Ernie Manufacturing has projected sales of $155 million next year. Costs are expected to be $100 million and net investment is expected to be $17.5 million. Each of these values is expected to grow at 14 percent the following year, with the growth ra..

  Do you come up with the same conclusion for question

Obtain a 95% confidence interval estimate of p1 - p2. Do you come up with the same conclusion for Question 21? Why or why not?

  Calculating cost of equity

Stock in CDB Industries has a beta of 1.14. The market risk premium is 7.4 percent, and T-bills are currently yielding 4.4 percent. CDB’s most recent dividend was $3.80 per share, and dividends are expected to grow at a 5.4 percent annual rate indefi..

  Shares of common stock outstanding

Erna Corp. has 6 million shares of common stock outstanding. The current share price is $72, and the book value per share is $7. Erna Corp. also has two bond issues outstanding. Suppose the most recent dividend was $4.40 and the dividend growth rate ..

  What is business and goal or purpose of business

There was once a student who wanted a business degree. This student was overheard one day saying the following: Why do I have to take Accounting? I am not going to be an accountant! Can you make a case for accounting in the BBA program? What is busin..

  Compared to fixed interest rates-variable rates

Variable rate debt never should be used by healthcare organizations because it is too risky. Compared to fixed interest rates, variable rates are riskier for the borrower but less risky for the lender. Compared to fixed interest rates, variable rates..

  Using the macrs depreciation method

A company has decided to purchase new office furniture with a useful life of 12 years for $100,000. Sales tax for the furniture was $6,000, and inbound transportation costs were $4,000. The new furniture will be kept for 10 years before being sold. I..

  What is the current spot price of gold at the lease rate

What is the current spot price of gold at the lease rate on the contract is 1.25% the risk free rate is 3% and thr 9 month forward price is $1000?

  Publicly owned firms are contemplating a merger

Two large, publicly owned firms are contemplating a merger. No operating synergy is expected. However, since returns on the 2 firms are not perfectly positively correlated, the standard deviation of earnings would be reduced for the combined corporat..

  Merger valuation

Harrison Corporation is interested in acquiring Van Buren Corporation. Assume that the risk-free rate of interest is 3% and the market risk premium is 8%. What is the per-share value of Van Buren to Harrison Corporation?

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