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# Answer to Question #140357 in Finance for Jenelle Daniel

Question #140357
Consider Donald and Joe who are both 30- years of age and recently graduated with a degree in Finance. Both Donald and Joe plan to retire at age 67, and the retirement plan pays a 12 percent per annum return and is also compounded monthly. Donald plans to invest $1,000 per month beginning next month into his retirement account, while Joe shall invest$2,000 per month. Joe however does not plan to begin investing until 10 years after Donald begins to invest. How much will each of the newly grads have at retirement?
1
2020-11-02T07:03:04-0500

"Future Value of Annuity = P \\times \\frac {(1+r)n-1} {r}"

For Donald

P= $1000 r= 12/12= 1% n= "37\\times 12=" 444 Therefore for Donald Future Value=$8,192,586

For Joe

P= $2000 r= 12/12= 1% n= "27\\times 12= 324" Therefore for Joe Future Value=$4,825,220

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