Question
1. Assume a hypothetical age that has not been chosen by any other students, (Must have a month in it, saying I am 21,
1. Assume a hypothetical age that has not been chosen by any other students, (Must have a month in it, saying I am 21, 22, or 23 years is not acceptable, but 21 years and 1 month, or 21 years and 8 months........ are acceptable). Assume you can earn 0.8% per month in the stock market by investing in S&P500; assume you buy $10,000 worth of an index ETF that represents the S&P500. When you get to age 67, how much is your investment worth? (The future value of $10,000, monthly compounding). 2. Assuming the same age as above in Q1, you can earn 10 % per year in the stock market by investing in S&P500; assume you buy $10,000 worth of an index ETF that represents the S&P500. At your retirement age of 67, the value of this $10,000 investment is $350,000.00. What is the average rate of return on your investment?
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