Asked by Briana Robinson on Apr 26, 2024
Verified
In planning for retirement, an investor decides she will save $17,000 every year for 38 years. At an 8% return on her investment, how much money will she have at the end of 38 years (to the nearest hundred thousand dollars) ?
A) $3,700,000
B) $6,800,000
C) $7,900,000
D) $10,800,000
Return On Investment
A measure used to evaluate the efficiency of an investment, calculated by dividing the benefit (return) of an investment by its cost.
Nearest Hundred Thousand
A rounding method where a number is rounded to the closest increment of one hundred thousand.
- Apply the theory of time value of money in crafting strategies for retirement savings and investments.
- Gain insight into the critical role of annual investments and their consequences on the eventual value of retirement reserves.
Verified Answer
AA
Abdullah Al RikabiMay 02, 2024
Final Answer :
A
Explanation :
Calculator entries are N = 38, I/Y = 8, PV = 0, PMT = 17,000, CPT FV → 3,745,371.07
Learning Objectives
- Apply the theory of time value of money in crafting strategies for retirement savings and investments.
- Gain insight into the critical role of annual investments and their consequences on the eventual value of retirement reserves.
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