Assume you want to retire early at age 53. You plan to save using one of the following two strategies: (1) save $3,000 a year in an IRA beginning when you are 28 and ending when you are 53 (25 years) or (2) wait until you are 41 to start saving and then save $6,250 per year for the next 12 years. Assume you will earn the historic stock market average of 10% per year. (Click the icon to view the future value annuity factor table.) (Click the icon to view the future value factor table.) (Click the icon to view the present value annuity factor table.) (Click the icon to view the present value factor table.) Read the requirements ... Requirement 1. How much out-of-pocket cash will you invest under the two options? Calculate how much out-of-pocket cash you will invest under the two options. Option 1: $ 75,000 Option 2: $ 75,000 Requirement 2. How much savings will you have accumulated at age 53 under the two options? Calculate the total amount of savings that you will have accumulated at age 53 under the two options. (Round the savings to the nearest dollar amount.) Option 1: 12 years. Assume you will earn the historic stock market average of 10% ck the icon to view the future value annuity factor table.) (Cli Requirements T. TIOW MUCI VUL-ur-pocne CASI Wur you most UTUCI TIC LWVU options? 2. How much savings will you have accumulated at age 53 under the two options? 3. Explain the results. 4. If you let the savings continue to grow for nine more years (with no further out-of-pocket investments), under each scenario, what will the investment be worth when you are age 62? Print Done Reference Present Value of Annuity of $1 Periods 1% 2% 3% 4% 5% 6% 8% 10% 12% Period 1 0.990 0.980 0.971 0.962 0.952 0.943 0.926 0.909 0.89 Period 2 1.970 1.942 1.913 1.886 1.859 1.833 1.783 1.736 1.690 Period 3 2.941 2.884 2.829 2.775 2.723 2.673 2.577 2.487 2.40: ce Period 3.902 3.808 3.717 3.630 3.546 3.465 3.312 3.170 3.037 Period 5 4.853 4.713 4.580 4.452 4.329 4.212 3.993 3.791 3.60 Period 6 5.795 5.601 5.417 5.242 5.076 4.917 4.623 4.355 4.111 Period 7 6.728 6.472 6.230 6.002 5.786 5.5825.206 4.868 4.564 Period 8 7.652 7.325 7,020 6.733 6.463 6.210 5.747 5.335 4.968 Period 9 8.566 8.1627.786 7.435 7.108 6.8026.247 5.759 5.32 Period 10 9.471 8.983 8.530 8.111 7.722 7.360 6.710 6.145 5.656 Period 11 10.368 9.787 9.2538.760 8.306 7.887 7.139 6.495 5.938 Period 12 11.255 10.575 9.954 9.385 8.863 8.384 7.536 6.814 6.194 Period 13 12. 134 11.348 10.635 9.986 9.394 8.853 7.904 7.103 6.424 Period 1413.004 12.106 11.296 10.563 9.899 9.295 8.244 7.3676.62 Period 15 13.865 12.849 11.938 11.118 10.380 9.7128.559 7.606 6.811 Period 20 18.046 16.351 14.877 13.590 12.462 11.470 9.818 8.514 7.46% Period 25 22.023 19.523 17.413 15.622 14.094 12.783 10.675 9.077 7.843 Period 30 25.808 22.396 19.600 17.292 15.372 13.765 11.258 9.427 8.054 Period 40 32.835 27.355 23.115 19.793 17.159 15.046 11.925 9.7798.24 Print Done more help Clear all Check ans HW Score: 34.69%, 2 Question 3, E12-24A (si... > mind.no 24 Reference Future Value of $1 Periods Period 1 Period 2 Period 3 Period 4 Period 5 1% 1.010 1.020 1.030 1.041 1.051 2% 1.020 1.040 1.061 1.082 1.104 3% 1.030 1.061 1.093 1.126 1.159 4% 1.040 1.082 1.125 1.170 1.217 5% 1.050 1.103 1.158 1.216 1.276 6% 1.060 1.124 1.191 1.262 1.338 8% 1.080 1.166 1.260 1.360 1.469 10% 1.100 1.210 1.331 1.464 1.611 Period 6 Period 7 Period 8 Period 9 Period 10 1.062 1.126 1.072 1.149 1.083 1.172 1.094 1.195 1.105 1.219 1.194 1.230 1.267 1.305 1.344 1.265 1.316 1.369 1.423 480 1.340 1.407 1.477 1.551 629 1.419 1.504 1.594 1.689 1.791 1.587 1.714 1.851 1.999 2.159 1.772 1.949 2.144 2.358 2.594 Period 11 Period 12 Period 13 Period 14 Period 15 Period 20 Period 25 Period 30 Period 40 1.116 1.243 1.127 1.268 1.138 1.294 1.149 1.319 1.161 1.346 1.220 1.486 1.282 1.641 1.348 1.811 1.489 2.208 1.384 1.426 1.469 1.513 1.558 1.539 1.601 1.665 1.732 1.801 1.710 1.898 2.332 2.853 1.796 2.012 2.518 3.138 1.886 2.133 2.720 3.452 1.980 2.261 2.937 3.797 2.079 2.397 3.172 4.177 2.653 3.207 4.661 6.727 3.386 4.292 6.848 10.835 4.322 5.743 10.063 | 17.449 7.040 10.286 21.725 45.259 1.806 2.191 2.094 2.666 2.427 3.243 3.262 4.801 Reference Present Value of $1 Periods 2% 1% 3% 4% 5% 6% 1 8% 10% Period 1 0.990 0.980 0.971 0.962 0.952 0.943 0.926 0.909 0. Period 2 0.980 0.961 | 0.943 0.925 0.907 0.890 0.857 0.820. Period 3 0.971 0.942 | 0.915 0.889 0.864 0.840 | 0.794 0.751 0. Period 4 0.961 0.924 0.888 0.855 0.823 0.792 0.735 0.683 0. Period 5 0.951 0.906 0.863 0.822 0.784 0.747 0.681 0.621 0. Period 6 0.942 0.888 0.837 0.790 0.746 0.705 0.630 0.564 0. Period 7 0.933 0.871 0.813 0.760 0.7110.665 0.583 0.513 0. Period 8 0.923 0.853 0.789 0.731 0.677 0.627 0.540 0.467 0. Period 9 0.914 0.837 0.766 0.703 0.645 0.592 0.500 0.424 0. Period 100.905 0.820 0.744 0.676 0.614 0.558 0.463 0.3860. Period 110.896 0.804 0.722 0.650 0.585 0.527 0.429 0.350 0. Period 12 0.887 0.788 0.701 0.625 0.557 0.497 0.397 0.319 0. Period 13 0.879 0.773 0.681 0.601 0.530 0.469 0.368 0.290 0. Period 140.870 0.758 0.661 0.577 0.505 0.442 0.340 0.263 0. Period 15 0.861 0.743 0.642 0.555 0.481 0.417 0.315 0.239 0. Period 200.820 0.673 0.554 0.456 0.377 0.312 0.215 0.149 0. Period 25 0.780 0.610 0.478 0.375 0.295 0.233 0.146 0.092 0. Period 30 0.742 0.552 0.412 0.308 0.231 0.174 0.099 0.057 0. Period 40 0.672 0.453 0.307 0.208 0.142 0.097 0.046 0.022 0 Reference Future Value of Annuity of Periods 1% 2% 3% 4% 5% 6% 8% 10% Period 1 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Period 2 2.010 2.020 2.030 2.040 2.050 2.060 2.080 2.100 Period 3 3.030 3.060 3.091 3.122 3.153 3.184 3.246 3.310 Period 4 4.060 4.122 4.1844.246 4.310 4.375 4.506 4.641 Period 5 5.101 5.204 5.309 5.416 5.526 5.637 5.867 6.105 Period 6 6.152 6.308 6.468 6.633 6.802 6.975 7.336 7.716 Period 7 7.214 7.434 7.6627.898 8.142 8.394 8.923 9.487 Period 8 8.286 8.583 8.8929.214 9.549 9.897 10.637 11.436 Period 9 9.369 9.755 10.159 10.543 11.027 11.491 12.488 13.579 Period 10 10.462 10.950 11.464 12.006 12.578 13.181 | 14.487 | 15.937 Period 11 11.567 12.169 12.808 13.486 14.207 14.972 16.645 18.531 Period 12 12.683 13.412 14.192 15.026 15.917 16.870 18.977 21.384 Period 13 13.809 14.680 15.618 16.627 17.713 18.882 21.495 24.523 Period 14 14.947 15.974 17.086 18.292 19.599 21.015 24.215 27.975 Period 15 16.097 17.293 18.599 20.024 21.579 23.276 27.152 31.772 Period 20 22.019 24.297 26.870 29.778 33.066 36.786 45.762 57.27 Period 25 28.243 32.030 36.459 41.646 47.727 54.865 73.106 98.347 Period 30 34.785 40.568 47.575 56.08566.439 79.058 113.283 164.49 Period 40 48.886 60.402 75.401 95.026 120.800 154.762 259.057 442.59