Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

An employee decided to invest in a trust fund which gives an interest rate of 2% compounded quarterly. Employee's monthly salary is $70,000 and decided

image text in transcribed

An employee decided to invest in a trust fund which gives an interest rate of 2% compounded quarterly. Employee's monthly salary is $70,000 and decided to invest 10% of her salary per month in the fund for 4 years. On the 5th year, the employee got promoted and her salary was increased to P100,000. She continued to invest the same percentage of her salary to the fund for 7 more years until she retires. QUESTION: After her retirement, she receives a monthly pension of P10,000, one month after her last payment. This pension is made to be forever, what will be the equivalent present worth of the said pension? O P402,147.81 P500,832.41 P4,825,773.72 O P6,009,988.92

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Stocks For The Long Run

Authors: Jeremy Siegel

6th Edition

1264269803, 978-1264269808

More Books

Students also viewed these Finance questions

Question

OUTCOME 5 Discuss sexual harassment as an employment equity issue.

Answered: 1 week ago