Finance

5. Sarah Wiggum would like to make a single investment and have $3.4 million at the time of her retirement in 25 years. She has found a mutual fund that will earn 3 percent annually. How much will Sarah have to invest today? If Sarah invests that amount and could earn a 15 percent annual return, how soon could she retire, assuming she is still going to retire when she has $3.4 million? Click on the table icon to view the PVIF table 1 To have $3.4 million at retirement, the amount Sarah must invest today is $ (Round to the nearest cent.) If Sarah invests that same amount and earn a 15% annual return, she could retire in approximately years. (Round to one decimal place.) 1: Data Table n 13% 17% 1% 0.990 0.980 3% 0.971 1 0.885 4% 0.962) 0.925 0.889 0.855 14% 0.877 0.769 6% 0.943 0.890 0.840 5% 0.952 0.907 0.864 0.823 0.784 15% 0.870 0.756 0.658 8% 0.926 0.857 0.794 0.735 0.681 18% 0.847 0.718 0.609 2 20% 0.833 0.694 0.579 2% 0.980 0.961 0.942 0.924 0.906 0.888 0.871 3 12% 0.893 0.797 0.712 0.636 0.567 0.507 0.452 4 0.855 0.971 0.961 0.951 0.942 0.933 0.675 0.592 0.519 19% 0.840 0.706 0.593 0.499 0.419 0.352 0.296 0.572 0.482 0.731 0.624 0.534 0.456 0.390 0.333 0.516 0.437 5 7% 0.935 0.873 0.816 0.763 0.713 0.666 0.623 0.582 0.544 0.508 0.475 0.822 0.497 0.432 6 0.746 0.711 0.792 0.747 0.705 0.665 0.627 0.592 0.558 0.630 0.583 0.456 0.400) 0.370 0.314 0.402 0.335 0.279 7 8 0.285 16% 0.862 0.743 0.641 0.552 0.476 0.410 0.354 0.305 0.263 0.227 0.195 0.168 0.145 0.125 0.108 0.790 0.760 0.731 0.703 0.676 0.650) 0.625 0.601 0.923 0.914 0.905 0.896 9 0.853 0.837 0.820 0.804 0.677 0.645 0.614 0.783 0.693 0.613 0.543 0.480 0.425 0.376 0.333 0.295 0.261 0.231 0.204 0.181 0.540 0.500 0.463 0.429 0.243 0.208 0.266 0.225 0.191 0.249 0.209 0.176 0.233 0.194 0.162 10 11 0.135 0.404 0.361 0.322 0.287 0.257 0.229 0.205 0.183 0.376 0.327 0.284 0.247 0.215 0.187 0.163 0.141 0.123 0.585 0.557 0.530 12 0.887 0.879 0.444 Present Value of $1 (PVIF) 9% 10% 11% 0.917 0.909 0.901 0.842 0.826 0.812 0.772 0.751 0.731 0.708 0.683 0.659 0.650 0.6211 0.593 0.596 0.564 0.535 0.547 0.513 0.482 0.502 0.467 0.434 0.460 0.424 0.391 0.422 0.386 0.352 0.388 0.350 0.317 0.356 0.319 0.286 0.326 0.290 0.258 0.299 0.263 0.232 0.275 0.239 0.209 0.252 0.218 0.188 0.231 0.198 0.170 0.212 0.180 0.153 0.194 0.164 0.138) 0.178 0.149) 0.124 0.164 0.135 0.112 0.150 0.123 0.101 0.138 0.112 0.091 0.126 0.102 0.082 0.116 0.092 0.074 13 0.397 0.368 0.340 0.315 0.415 0.388 0.112 0.093 0.178 0.152 0.130 0.111 0.095 0.162 0.137 0.116 0.099 0.084 0.351 0.308) 0.270 0.237 0.208 0.182 0.160 0.140 0.123 0.108 0.095 0.083 0.148 0.124 0.104 0.088 0.074 14 0.505 0.870 0.861 0.577 0.555 0.078 0.065 15 0.943 0.915 0.888 0.863 0.837 0.813 0.789 0.766 0.744 0.722 0.701 0.681 0.661 0.642 0.623 0.605 0.587 0.570 0.554 0.538 0.522 0.507 0.492 0.478 0.412 0.355 0.307 0.228 0.481 0.788 0.773 0.758 0.743 0.728 0.714 0.700 0.686 0.673 16 0.362 0.339 0.853 0.527 0.497 0.469 0.442 0.417 0.394 0.371 0.350 0.331 0.312 0.294 0.458 0.292 0.534 0.513 0.160 0.141 0.125 0.054 0.093 0.080 0.081 0.069 0.062 0.052 17 0.844 0.436 0.317 0.296 0.107 0.093 0.081 0.070 0.071 0.060 0.051 0.043 18 0.069 0.059 0.836 0.828 0.044 0.037 0.494 0.475 0.456 0.439 19 0.416 0.396 0.377 0.359 0.045 0.038 0.031 0.026 0.277 0.258 0.111 0.098 0.087 0.077 20 0.820 0.073 0.163 0.146 0.130 0.116 0.104 0.093 0.083 0.074 0.066 0.059 0.060 0.051 0.044 0.270 0.250 0.232 0.215 0.199 0.184 0.170 0.158 0.146 0.051 0.043 0.037 0.031 0.026 21 0.660 0.242 0.022 0.811 0.803 0.795 22 0.647 0.226 0.068 0.064 0.056 0.049 0.038 0.032 0.342 0.326 0.022 23 0.060 0.634 0.622 0.422 0.406 0.390 0.375 0.211 0.197 24 0.788 0.037 0.031 0.026 0.022 0.019 0.016 0.007 0.003 0.043 0.018 0.015 0.013 0.010 0.310 0.295 0.061 0.053 0.046 0.040 0.035 0.030 0.015 0.008 0.004 0.001 0.033 0.028 0.024 0.053 0.047 0.027 0.023 0.020 0.018 0.015 0.013 25 0.780 0.610 0.278 0.262 0.247 0.233 0.174 0.130 0.097 0.054 0.184 0.038 30 0.552 0.231 0.131 0.057 0.026 0.020 0.009 0.742 0.706 0.308 0.253 0.075 0.049 0.033 0.019 0.005 0.002 0.004 0.002 35 0.181 0.036 0.044 0.026 0.015 0.014 0.500 0.453 0.004 0.099 0.068 0.046 0.021 40 0.012 0.006 0.003 0.001 0.094 0.067 0.034 0.672 0.142 0.011 0.208 0.141 0.002 0.001 0.010 0.005 0.001 0.032 0.013 0.022 0.009 0.008 0.002 0.001 0.000 0.001 0.000 50 0.608 0.372 0.087 0.005 0.003 0.0001 0.000 5. Sarah Wiggum would like to make a single investment and have $3.4 million at the time of her retirement in 25 years. She has found a mutual fund that will earn 3 percent annually. How much will Sarah have to invest today? If Sarah invests that amount and could earn a 15 percent annual return, how soon could she retire, assuming she is still going to retire when she has $3.4 million? Click on the table icon to view the PVIF table 1 To have $3.4 million at retirement, the amount Sarah must invest today is $ (Round to the nearest cent.) If Sarah invests that same amount and earn a 15% annual return, she could retire in approximately years. (Round to one decimal place.) 1: Data Table n 13% 17% 1% 0.990 0.980 3% 0.971 1 0.885 4% 0.962) 0.925 0.889 0.855 14% 0.877 0.769 6% 0.943 0.890 0.840 5% 0.952 0.907 0.864 0.823 0.784 15% 0.870 0.756 0.658 8% 0.926 0.857 0.794 0.735 0.681 18% 0.847 0.718 0.609 2 20% 0.833 0.694 0.579 2% 0.980 0.961 0.942 0.924 0.906 0.888 0.871 3 12% 0.893 0.797 0.712 0.636 0.567 0.507 0.452 4 0.855 0.971 0.961 0.951 0.942 0.933 0.675 0.592 0.519 19% 0.840 0.706 0.593 0.499 0.419 0.352 0.296 0.572 0.482 0.731 0.624 0.534 0.456 0.390 0.333 0.516 0.437 5 7% 0.935 0.873 0.816 0.763 0.713 0.666 0.623 0.582 0.544 0.508 0.475 0.822 0.497 0.432 6 0.746 0.711 0.792 0.747 0.705 0.665 0.627 0.592 0.558 0.630 0.583 0.456 0.400) 0.370 0.314 0.402 0.335 0.279 7 8 0.285 16% 0.862 0.743 0.641 0.552 0.476 0.410 0.354 0.305 0.263 0.227 0.195 0.168 0.145 0.125 0.108 0.790 0.760 0.731 0.703 0.676 0.650) 0.625 0.601 0.923 0.914 0.905 0.896 9 0.853 0.837 0.820 0.804 0.677 0.645 0.614 0.783 0.693 0.613 0.543 0.480 0.425 0.376 0.333 0.295 0.261 0.231 0.204 0.181 0.540 0.500 0.463 0.429 0.243 0.208 0.266 0.225 0.191 0.249 0.209 0.176 0.233 0.194 0.162 10 11 0.135 0.404 0.361 0.322 0.287 0.257 0.229 0.205 0.183 0.376 0.327 0.284 0.247 0.215 0.187 0.163 0.141 0.123 0.585 0.557 0.530 12 0.887 0.879 0.444 Present Value of $1 (PVIF) 9% 10% 11% 0.917 0.909 0.901 0.842 0.826 0.812 0.772 0.751 0.731 0.708 0.683 0.659 0.650 0.6211 0.593 0.596 0.564 0.535 0.547 0.513 0.482 0.502 0.467 0.434 0.460 0.424 0.391 0.422 0.386 0.352 0.388 0.350 0.317 0.356 0.319 0.286 0.326 0.290 0.258 0.299 0.263 0.232 0.275 0.239 0.209 0.252 0.218 0.188 0.231 0.198 0.170 0.212 0.180 0.153 0.194 0.164 0.138) 0.178 0.149) 0.124 0.164 0.135 0.112 0.150 0.123 0.101 0.138 0.112 0.091 0.126 0.102 0.082 0.116 0.092 0.074 13 0.397 0.368 0.340 0.315 0.415 0.388 0.112 0.093 0.178 0.152 0.130 0.111 0.095 0.162 0.137 0.116 0.099 0.084 0.351 0.308) 0.270 0.237 0.208 0.182 0.160 0.140 0.123 0.108 0.095 0.083 0.148 0.124 0.104 0.088 0.074 14 0.505 0.870 0.861 0.577 0.555 0.078 0.065 15 0.943 0.915 0.888 0.863 0.837 0.813 0.789 0.766 0.744 0.722 0.701 0.681 0.661 0.642 0.623 0.605 0.587 0.570 0.554 0.538 0.522 0.507 0.492 0.478 0.412 0.355 0.307 0.228 0.481 0.788 0.773 0.758 0.743 0.728 0.714 0.700 0.686 0.673 16 0.362 0.339 0.853 0.527 0.497 0.469 0.442 0.417 0.394 0.371 0.350 0.331 0.312 0.294 0.458 0.292 0.534 0.513 0.160 0.141 0.125 0.054 0.093 0.080 0.081 0.069 0.062 0.052 17 0.844 0.436 0.317 0.296 0.107 0.093 0.081 0.070 0.071 0.060 0.051 0.043 18 0.069 0.059 0.836 0.828 0.044 0.037 0.494 0.475 0.456 0.439 19 0.416 0.396 0.377 0.359 0.045 0.038 0.031 0.026 0.277 0.258 0.111 0.098 0.087 0.077 20 0.820 0.073 0.163 0.146 0.130 0.116 0.104 0.093 0.083 0.074 0.066 0.059 0.060 0.051 0.044 0.270 0.250 0.232 0.215 0.199 0.184 0.170 0.158 0.146 0.051 0.043 0.037 0.031 0.026 21 0.660 0.242 0.022 0.811 0.803 0.795 22 0.647 0.226 0.068 0.064 0.056 0.049 0.038 0.032 0.342 0.326 0.022 23 0.060 0.634 0.622 0.422 0.406 0.390 0.375 0.211 0.197 24 0.788 0.037 0.031 0.026 0.022 0.019 0.016 0.007 0.003 0.043 0.018 0.015 0.013 0.010 0.310 0.295 0.061 0.053 0.046 0.040 0.035 0.030 0.015 0.008 0.004 0.001 0.033 0.028 0.024 0.053 0.047 0.027 0.023 0.020 0.018 0.015 0.013 25 0.780 0.610 0.278 0.262 0.247 0.233 0.174 0.130 0.097 0.054 0.184 0.038 30 0.552 0.231 0.131 0.057 0.026 0.020 0.009 0.742 0.706 0.308 0.253 0.075 0.049 0.033 0.019 0.005 0.002 0.004 0.002 35 0.181 0.036 0.044 0.026 0.015 0.014 0.500 0.453 0.004 0.099 0.068 0.046 0.021 40 0.012 0.006 0.003 0.001 0.094 0.067 0.034 0.672 0.142 0.011 0.208 0.141 0.002 0.001 0.010 0.005 0.001 0.032 0.013 0.022 0.009 0.008 0.002 0.001 0.000 0.001 0.000 50 0.608 0.372 0.087 0.005 0.003 0.0001 0.000