5. Good news: You will almost certainly be a millionaire by the time you retire in 40 years. Bad news: The inflation rate over your lifetime will average about 3.8%.

a. What will be the real value of $1 million by the time you retire in terms of todays dollars? (Enter your answers in whole dollars, not in millions. Do not round intermediate calculations. Round your answer to 2 decimal places. )

b. What real annuity (in todays dollars) will $1 million support if the real interest rate at retirement is 2.8% and the annuity must last for 10 years? (Enter your answers in whole dollars, not in millions. Do not round intermediate calculations. Round your answer to 2 decimal places.)

3. You believe you will need to have saved $360,000 by the time you retire in 30 years in order to live comfortably. You also believe that you will inherit $111,000 in 5 years. (Do not round intermediate calculations. Leave no cells blank - be certain to enter "0" wherever required. Round your answers to 2 decimal places.)

1. If the interest rate is 5% per year, what is the future value of your inheritance at retirement?

What is the present value of a 3-year annuity of $300 if the discount rate is 7%? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

b. What is the present value of the annuity in (a) if you have to wait an additional year for the first payment? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)